How Does a Nursing Sign-On Bonus Work?
If you’re looking for a new nursing job, you’ve probably noticed some post-acute facilities and hospitals offering sign-on bonuses for nurses. These can be enticing, especially if you’re paying off nursing school. But are there drawbacks to these payouts? And what should every nurse know before accepting a nursing sign-on bonus? Here’s an overview of how these incentives work and how to evaluate a sign-on bonus policy so that you can make an informed decision.
Keeping units and departments properly staffed keeps patients safe. As the gap between the number of nursing professionals and nursing jobs increases, facilities are increasingly offering sign-on bonuses to attract nursing and allied health professionals. These are some other types of income-based recruitment and retention programs:
- Retention bonuses
- Relocation bonuses
- Shift differentials
- Performance bonuses
- Referral bonuses
- Completion bonuses
What Is a Nursing Sign-On Bonus?
Signing bonuses for nurses are financial incentives that healthcare employers offer as a way to fill open positions quickly. They can be offered as a lump sum or in addition to your hourly income. Bonuses can vary in size, ranging from a few hundred dollars to $100,000, depending on the healthcare facility, location, and the urgency of the staffing needs.
Sign-on bonuses are usually advertised as part of the compensation package for nursing jobs, and they can be especially common in specialties where there is a high demand for nurses, such as med-surg, intensive care, and post-acute care. Here are some of the health facilities that may offer sign-on bonuses:
- Hospitals
- Long-term care facilities
- Home health agencies
- Outpatient clinics
- Correctional facilities
- Government healthcare facilities
- Behavioral health facilities
- Travel nursing agencies
While extra cash sounds nice, some nurses are wary of permanent roles with sign-on bonuses because they can mean that a facility or unit isn’t being run well. When that happens, nurses may leave, and the nurses who stay face worsening conditions — think high patient ratios and unsafe care.
However, just because you see that a facility offers a nursing sign-on bonus doesn’t mean you need to write them off, but you should review the terms of your employment carefully and be prepared to refuse if you’re uncomfortable with them.
What to Look Out For When You’re Offered a Sign-On Bonus
Sign-on bonuses can come with strings attached. For example, some terms and conditions may make leaving difficult. If you’re offered an LPN, NP, or registered nurse sign-on bonus, here are a few things to be aware of:
- Bonuses are taxed and may increase your tax rate. The IRS views bonuses as supplemental income, so you may be taxed at a higher rate than just your regular paycheck. The amount you actually take home will be less than the advertised bonus. Be sure to clarify with the employer what the post-tax amount will be.
- Understand prorated repayment clauses. If you leave before completing the contract, you may be required to pay back part or all of the bonus. For example, if you sign a contract for a $10,000 bonus and are required to stay at the facility for two years, leaving after one year might mean paying back half. In some cases, the repayment terms can be stricter, with nurses needing to repay the full amount if they leave at any point before the end of the contract.
- Evaluate the workplace. Don’t let a bonus cloud your judgment about the environment you’ll be working in. Research the facility’s reputation, nurse-to-patient ratios, and turnover rates. Ask to speak with current staff about their experiences. And remember, a bonus isn’t necessarily a reason to turn down a job offer if it seems like the workplace is supportive.
- Don’t be afraid to ask questions or push back. If you’re nervous about accepting a sign-on bonus, you can request to have it removed from your contract. On the other hand, it’s a bad sign if you’re uncomfortable during the recruitment process. Don’t accept a job just because you feel pressured to take it.
While sign-on bonuses may seem like a great financial boost, consider the entire compensation package and the terms of the bonus. Some nurses argue that sign-on bonuses can be a trap if not properly understood.
Is a cash bonus worth the commitment if a unit turns out to be a stressful environment or just a poor fit for you? What if you end up needing to move or your availability changes? These are essential questions to consider before accepting a nursing sign-on bonus.
Nursing Sign-On Bonus FAQs
Is a nurse sign-on bonus in a job description a red flag?
Not necessarily, although this thinking is common among nursing professionals. Bonuses are becoming a more common strategy as facilities try to attract nurses during a mass shortage. A sign-on bonus can be a cue that a facility is in acute need of staff — but since there could be a shortage of 10 million nurses by 2030, expect bonuses to become the norm.
If you’re offered a sign-on bonus, consider it within the context of the role itself. In your job interview, you might want to ask questions such as:
- What will the nurse-to-patient ratios be like?
- What is the turnover rate at the facility, and why are nurses leaving?
- Will I receive adequate training and support during onboarding?
- Will I be required to complete mandatory overtime due to staffing shortages?
- Is there room for growth and advancement within the organization?
How do hospital sign-on bonuses work?
Nursing sign-on bonuses aren’t always handed over in one lump sum. Some employers may offer part of the bonus upfront after hiring, while others may distribute it over time. Here are common ways employers might structure the payment:
- Upfront payment: A portion of the bonus is given shortly after hiring, often upon completing a probationary period.
- Incremental payments: Some facilities spread the payments over a set period, such as six months, a year, or even several years, which means you won’t receive the full bonus immediately.
- Bonus at contract completion: In some cases, the entire bonus is paid only after you complete a specified contract length, which is often one to three years.
Do nurses get sign-on bonuses?
Yes — RN jobs, LPN jobs, and NP jobs can include sign-on bonuses. Some facilities may also offer bonuses for these allied health, nursing, and medical professionals:
- Nursing assistants (CNAs)
- Surgical techs
- Nurse anesthetists (CRNAs)
- Physician’s assistants (PAs)
- Respiratory therapists (RTs)
Should you take a sign-on bonus as a nurse?
It depends on the context of the job offer, how comfortable you feel accepting the role, and the terms of your contract. You can refuse a sign-on bonus if you don’t feel comfortable taking it. You can also plan to save the bonus you receive, so if you leave the role early, you won’t be scrambling to pay back part or all of your bonus.
Looking for a Role With a Nursing Sign-On Bonus?
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