6.09—Retention Bonus

Effective: 03/01/2010
Senate Proposal: No
Responsible University Officer: Vice President for Administration
Responsible Office: Human Resources

Policy Statement

A retention bonus may be awarded to retain an eligible employee with valuable knowledge, skills or abilities that are vital to the accomplishment of the strategic plan.

Policy Requirements

Retention bonus requests require:

  • written justification of how and why the eligible employee is deemed to be vital to the execution of the university's or department's strategic plan,
  • approval of supervisor, department chair/director or dean (as applicable) and Vice President(s), and
  • at least two signatures (approval is required at least through Vice President).

Bonus payments are taxable at the time of payment.

Bonus payments can not be made from sponsored funds.

If the bonus recipient leaves the university within one year (one calendar year for staff or contract term for faculty) of receiving the bonus, the bonus must be returned to the university.

Reason for Policy

Established to provide a monetary bonus to retain a faculty or staff member who is highly skilled and loss of their services may create a significant void for the University. The retention bonus policy supports the University's Strategic Plan, Goal 1: 1.1, which states the University will "provide competitive compensation, recognize and reward successful faculty and staff."

Eligible employees may receive only one retention bonus a year.

There is a one-year waiting period between retention bonus awards.

Monetary bonus is not added to institutional base salary (IBS).


Hourly (including represented employees), fixed term, and temporary employees are not eligible to receive retention bonuses.


Office/Unit Name Telephone Number
Human Resources 487-2280


Eligible Employee - Regular full- and/or part-time non-represented employees.

Institutional Base Salary (IBS) - Annual compensation paid by the University for an employee's appointment, whether that individual's time is spent on research, instruction, administration or service. IBS does not include additional, bonus, or faculty summer compensation. IBS also excludes any income that an individual is permitted to earn outside of duties for the University.


Department Chair/Director, Dean and Vice President(s) (as applicable) - Reviews the request and signs the Bonus Request Form indicating approval.

Eligible Employee's Primary Department - Completes the Bonus Request Form, ensures appropriate approvals (of at least two signatures) on the request form, identifies funding source for the bonus payment, and ensures written justification is included with the form.

Human Resources - Receives the completed form and reviews for accuracy and appropriate signatures, obtains provost/vice president signatures as applicable, and processes request for payment.

Supervisor of Eligible Employee - Provides written justification including the qualities and contributions that the eligible employee provides and why they are deemed to be vital to the execution of the University's or department's strategic plan.


In support of this policy, the following procedures are included:


Forms and Instructions

In support of this policy, the following forms/instructions are included:



Adoption Date

02/23/2010 Approved by VP for Administration.


2/29/2024 Added eligible staff to policy.
04/10/2017 Transfer of policy page from HTML to CMS. Business and Finance numbers renamed from "2.6000" to "6. Human Resources". Specifically from "2.6009—Retention Bonus" to "6.09—Retention Bonus".
05/08/2012 To reflect current University titles and practice, MTU is now Michigan Tech and the email address for questions is now hbwebmaster.
06/11/2010 Removed "and whose departure would have an adverse impact on the University" from the policy statement.