Boston Scientific (NYSE:BSX) employees could see their annual bonus payments shrink or grow based on the device maker’s adjusted earnings per share and global sales by the end of the year, thanks to a new performance incentive plan for 2012.
The Natick, Mass.-based med-tech titan reconfigured its employee reward system, tying the total potential payout for all regions and division into a single pool, the value of which fluctuates along with the company’s performance in 2012.
BoSci established an "aggregate bonus pool," a target amount for total bonuses for all participants across all business arms. That replaces the previous system in which each business unit had a discrete bonus pool.
At the end of the year the actual value of the company bonus pool will fluctuate to between 50% and 150% of the target, based on performance goals such as sales, adjusted earnings per share and quality goals.
What remains will be divvied up among the various business units, including corporate, global operations and regional units, based on their achievements relative to their respective "scorecards," and management for each branch will determine the ultimate reward for each employee participating in the plan. Individual employees’ rewards could range from 0% to 200% of bonus targets.
"The plan’s purpose is to align the company’s interests and your interests as a plan participant by providing incentive compensation for the achievement of company and individual performance objectives," the company wrote in a primer for employees.
Boston Scientific reported a 54.7% decline in 4th-quarter profits – despite a swing to black ink for the full year.
BSX shares were down 2.8% to $5.83 in afternoon trading as of about 2:45 p.m. today.
