Career & Finances | Finances | Original Content

The Need to Replace Sign-on Bonuses with Retention Bonuses for Nurses

  • Sign-on bonuses are given to new nurses to serve as an incentive to begin working at a specific healthcare facilty.
  • Retention bonuses for nurses are just one of the many ways healthcare administrators can express their appreciation to their hard-working staff.
  • Nursing CE Central provides a breakdown of both sign-on and retention bonuses for nurses, and which seems to be the most beneficial to all. Check it out!
Morgan Curry, RN/BSN

Morgan Curry, BSN / RN

Intensive Care, Outpatient Surgery, Aesthetics, Education, and Nursing Leadership

May 28, 2021
Simmons University


Low pay wage is commonly associated with job dissatisfaction and can lead to leaving the workspace.  

For underpaid nurses, this significantly impacts the global nursing shortage 

It takes an incredibly special person to become a nurse, as they constantly work each day (and night) to provide care for their patients; so, why would they want a signon bonus? 

For the staffing agency, sign-on bonuses serve as an incentive to contract nurses, which may seem beneficial to both parties involved; however, the agency is working to reach a quota, while the nurse is accepting a short-term compensation in exchange for their tireless work, sacrifices, and efforts as a backbone of healthcare facilities. 

So, are they truly benefiting from the initial sign-on bonus? Not really.  

Additionally, for the loyal nurses who have dedicated years of service to their organization, sign-on bonuses do everything besides reward them for their hard work and sacrifices. 

However, there is another option; one that can improve job satisfaction and nurse retention. Do you know where I’m going with this? 

How about retention bonuses for nurses?  

As a healthcare facility, why wouldn’t you want to reward your most loyal employees that have given their all for your patients


Reward loyalty. Reward heart. Reward grit. Reward that nurse with a retention bonus.  

Pros and Cons of Sign-on Bonuses vs. Retention Bonuses for Nurses 

Sign-on Bonuses

The creators of an ecosystem-uniting software, and educationally based entrepreneurial community, HubSpot, defines a sign-on bonus as a one-time sum a company might give a new employee as an incentive to join the company.  


• It creates an additional incentive for nurses to begin working immediately. 

• Increase in employees, positively contributing to the nursing shortage. 


• Only benefits new nurses.  

• Risk for turnover.  

• Risk for causing tension between the new and experienced nurses within the facility. 

• Resentment from experienced nurses toward administrators 

Retention Bonuses

Reputable financial advising and education provider, Investopedia, defines retention bonuses for nurses as a targeted payment or reward outside of an employee’s regular salary that is offered as an incentive to keep a key employee on the job during a particularly crucial business cycle.  

Following, registered nurse, John Bass, writes in the Journal of Emergency Nursing that retention bonuses for nurses should be implemented by all healthcare facilities in replacement of sign-on.


• Builds positive nurse-to-administrator relationships.

• Higher retention rates.

• Increase in employee workplace satisfaction.


• Recruitment is more difficult.

• Expensive.

A sign-on bonus is quickly offered, quickly spent, and just as quickly forgotten.  

Why Retention Bonuses for Nurses Makes More Sense  

If you were to go into any unit of any hospital, I can almost guarantee that you would encounter a nurse who is voicing their frustrations regarding pay rates and insanely high sign-on bonuses being earned by the new nurses.  

Nurses today need retention bonuses, not sign-on bonuses.  

Of course, there may be accounting factors such as workplace environment, staffing ratios, or whatever the case may be, if you think about it, why are new nurses being rewarded before the ones who have already proved themselves?  

Although we as nurses do not work to be rewarded, the idea of new nurses receiving compensation without doing any hands-on care can decrease any experienced nurse’s drive to work 

For hospital administrators, yes, retention bonuses may be more expensive; but, not as expensive as the money they are losing on additional recruiting, training, and other extraneous costs that come along with rapid nurse turnover.  

Despite crisis, sickness, and death that nurses experience daily, they provide excellent care to their patients, and this should not go unrecognized by administrators.   

A sign-on bonus is quickly offered, quickly spent, and just as quickly forgotten.  

Whereas a retention bonus is a great way to start rewarding your dedicated employees. 

It has the potential to trickle into a snowball effect, starting with a retention bonus, and moving towards a positive, safe, and supportive work environment. This is a win-win situation for nurses and hospital administrators. 

Spend money on rewarding your employees, and in turn, you will be rewarded. 

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