Target Reduces Salaried Employee Bonuses Following 2024 Results
Target salaried employees who are eligible for bonuses will only receive 87 percent of their potential bonus for fiscal year 2024 based on total-year financial performance, reports YahooFinance. That percentage is a considerable drop from FY 2023, when bonuses were paid at 100 percent. In earnings reported March 4 for FY 2024, Target announced that net sales had declined, though comparative sales year-to-year were up. Target also said that the beginning of 2025 may be marked by “meaningful year-over-year profit pressure” driven in part by tariff uncertainty, indicating cautiousness moving forward. Bonuses were based only on FY 2024 financial performance, according to a company spokesperson.
Target has undergone a number of shifts in recent months. The company tapped new executives at the beginning of the year to replace one retiring and one departing leader, and also drew headlines at the end of January when it ended some of its diversity, equity and inclusion initiatives due to an “evolving external landscape,” the company said at the time. In its slew of changes, Target ended its three-year DEI goals as well as its Racial Equity Action and Change initiatives, according to a company blog post; it also ended its participation in third-party diversity surveys such as the Human Rights Campaign’s Corporate Equality Index.
Total Retail's Take: In early March, Target announced its new strategic plans to drive "billions of dollars of profitable sales growth across its multichannel business by 2030." However, the retailer has faced its fair share of challenges over the past year. Its reduction in employee bonus payments by nearly one-fifth is an indication of the drop in profitability experienced in 2024. Furthermore, 2025 has not started particularly strong for the Target, either. The retailer is facing consumer boycotts over its DEI policy reversal while also navigating possibly cost increases under new tariffs.
The cuts in salaried employee bonuses are reportedly only a reflection of disappointing 2024 financial performance, and not a cost-reduction measure for 2025. Target is opening new stores and investing in innovation, partnerships, personalization, its loyalty program, supply chain evolution and more, according to its strategic plan announcement. What remains to be seen is how the smaller bonus payments will impact employee morale. Happier employees tend to be better employees, leading to improved customer experiences and the trickle-down effect of increased revenues. Of course, the opposite can be true as well.
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Kristina Stidham is the digital content director at Total Retail and sister brands Women in Retail Leadership Circle and Women Leading Travel & Hospitality at NAPCO Media. She is passionate about digital media and handles video, podcast and virtual event production for all brands. You can often find her at WIRLC, TR, WLT&H or industry events with her camera and podcasting equipment—or at home on Zoom—recording interviews with thought leaders and business executives.
Kristina holds a B.A. in Media Studies and Production from the Temple University Klein College of Media and Communication in Philadelphia. Go Owls! When she's not in the office, she loves to go on long walks, sing around the house, hangout with her family and two pet guinea pigs, and travel to new places.
