Glossary · Compensation
Golden hello
A golden hello is a signing bonus paid to a senior hire on joining, often to offset the bonuses or equity they forfeit by moving.
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Used to close the gap when a strong candidate would lose unvested awards by moving. It can be cash, equity, or a guaranteed first-year bonus, and is sometimes clawed back if the hire leaves early.
The phrase belongs to the senior end of the market and describes a purpose as much as a payment: to make a move financially neutral, or close to it, for someone who would otherwise leave value behind. That separates it from an inducement at large. An inducement's size is a matter of negotiation; a golden hello sized as a buy-out is a reconciliation, and it can be checked against the documents it replaces.
Two neighbours mirror it. A retention award runs the other way: a current employer pays it to keep someone, and a counteroffer can include one. And severance is its opposite number at the end of employment, pricing the exit rather than the entry; both belong in a reading of total compensation.
In practice
A golden hello is often sized against what a candidate forfeits by moving, which puts the detail of the existing awards at the centre: what is unvested, on what schedule it would have vested, and whether an earned bonus lapses on resignation under the plan and the contract. In that case, a figure built against that schedule can be reconciled line by line; a round number agreed before the incentive documents have been read may be reopened once they arrive.
How the payment is structured is a separate question from its size. Cash on the first payroll run is not the same thing as a replacement equity award that vests over time, though both can be quoted at one headline figure. Where the offer provides for it, a repayment clause applies if the hire resigns inside a defined window, sometimes reducing as service accrues. Granted once rather than annually, it sits outside the recurring package: cash lands in the first year, a replacement award across its vesting schedule.
Because a buy-out reconciles against documents, the documents are what get asked for: the plan rules, the grant letters, the latest vesting statement, and the bonus terms that say whether an award lapses on resignation. A payment agreed without them rests on the candidate's memory of their own package; one agreed against them can be audited, and its repayment terms can be drafted to follow the schedule it replaces. Where the replacement is itself paid in shares or options, governance rules on holding and exercise periods may apply to it as well, a point taken up under equity compensation.
Common questions
- Is a golden hello the same as a signing bonus?
- Broadly yes: golden hello is the term used at senior or executive level, particularly where the payment buys out awards forfeited by leaving, while a signing bonus at any level can simply be an inducement to accept. The difference is one of register and purpose rather than legal form. Both are granted once on joining rather than repeating annually, and either may be subject to repayment terms where the offer sets them out.
- Do you have to pay back a golden hello if you leave?
- Only if the offer contains a clawback clause and the departure falls inside the period it specifies. Where such a clause exists, the repayable amount may be fixed or may reduce with service. Whether it is triggered by resignation alone or also by dismissal depends on the drafting, and enforceability varies by jurisdiction and contract, so the terms are set out in the offer documents rather than by any general rule.
- Does a golden hello count as part of total compensation?
- It counts in the year or years it lands in, but not in the recurring package, because it is granted once rather than annually. That is why an offer is often read on two figures: the total including the joining payment, and the recurring total of base, bonus, and equity. Treating them as one overstates the ongoing position.
- How is a golden hello calculated?
- There is no formula, but there is a method. The usual starting point is the value the candidate forfeits by resigning: unvested equity at a stated valuation, a bonus that would have paid out after the leaving date, and any deferred pay that lapses. That figure is then adjusted for timing, since cash now and an award vesting later are not worth the same, and for tax, which differs by jurisdiction and by instrument.
Placed, not posted.
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