A potential employer just sent me an offer with a 20k reduction in base salary, but 20k added on in bonuses if I meet expectations. Anyone in CTO/programming/IT capacity work this way?
I'm not sure why anyone would take such a deal, it's not uncommon for developers to have bonuses tied to performance but I would expect that to be on-top of a competitive base salary and not in-lieu of it.
I've never heard of that and unless you are happy with the worst-case base salary I would renegotiate. Having been a part of many bonus systems, I never plan on the bonus money to actually hit my bank account.
All else being equal, I would say No deal. reduction in base salary is a huge thing. Let me tell you why. Lets say you do take that new job with the salary reduction, best case you get that 20K bonus. Now, if you want to switch jobs, most employers will consider your base salary first and bonus second because bonus is not guaranteed. Your leverage or power to negotiate goes down with a lesser base salary. Worst case, you don't even get the bonus (oh we had a bad year u know) and there u r. 20K reduced base with 0 bonus. Your next potential employer wont care less why u took a reduction. They see reduction, period.<p>I know i m sounding harsh here but thats the reality of salaries these days. I understand that startups might have a little more flexibility but as a professional with 10 years of work experience, I would <i>never</i> <i>ever</i> suggest to take a salary reduction. You just don't know where you will end up next.
What about benefits? My current employer values benefits at 22% of one's gross salary. I'm a contractor so they figure if I am going to be an employee that I should work for X - 22% + a non-guaranteed performance bonus of 7-15%.
It depends upon the company. If it's a young company that's growing then they might like to give you the salary but can't afford it. By giving you part of the salary as a bonus, it allows them backload the cost.