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Around 100 Goldman Sachs employees did not receive any bonus for 2016. The move is considered a harsh one, as usually even the lowest performers receive something.
The 100 bankers who missed out on their annual bonus were among the bottom 20% of performers per their annual review, Bloomberg reports. At certain profitable firms in the industry, being denied a bonus – also known as “getting a doughnut” – is seen as a sign you’re no longer wanted.
Sources with knowledge of the matter told Bloomberg the doughnut bonuses act as a message to a bigger crowd of underperformers that they’d be better off elsewhere.
They added that bonuses were taken away from less productive employees in order to be able to reward top performers while keeping the overall compensation costs in check.
For many bankers and traders, not receiving an annual bonus can have a big impact on people’s finances, since it eliminates what’s typically a major component of their pay.
ALSO READ: 40% would change jobs over year-end bonus
Photo / iStock