Here at megacorp, bonuses are based on a formula that is pre-determined and therefore we do not and cannot back out of them. If performance matches the target communicated at the beginning of the year, the bonus gets paid. If the target is not met, then per the formula it is paid pro-rata, or not paid if it does not meet the minimum threshold. That said, the company can be profitable and not pay a bonus. We do not pay bonuses based on "being profitable". Its only paid based on achievement of target.
That said, I am tryimg to restrict overtime. If they do it, we pay it. But, I am asking the managers to sharply reduce it, based on the level of work their dept has to accomplish. Hey, if the orders are down, it should not take the same amount of time to produce x-20% widgets as it takes to produce x widgets...correct? In fact, availability of raw materials is even better than it was before, at better cost, with better timing, so our production should take even less time. Alas, in some areas of asia, including this one, if the boss does not go home neither do the worker-bees...so getting the managers to go home is a key driver.
Bottom line is that I like paying bonuses, and I like paying fair wages. My incentives are mostly tied to the same performance targets as my people have (sometimes my targets are even higher, and I also have a stock price component - nothing from that this year), so if I can pay them a good bonus, it usually means I will be smiling too.
R