What Is Retained Earnings?


When a company is negotiating compensation with an employee, they will be discussing a contractual obligation called “retained salary.” The terms of this agreement are not laid out in the employee’s contract – instead, the company simply includes this in the compensation negotiation letter. What does this mean to you? Read on to find out.

In addition to what is referred to as “retained salary,” there may also be other terms that are written into the contract. If the company wants to include benefits in the retainer agreement, these will also be listed. These terms include medical coverage, dental, vision care, life insurance, disability income, and income protection. In some contracts, the term “retainer” is replaced by the phrase “permanent retainer,” which means the same thing as “lifetime retainer.”

So, what exactly is the role of the employee in a contract negotiation? When a company is considering a new contract or renegotiating an existing one, the employee is usually the one who makes the first contact with the company. They are usually the one who explains their compensation issues and gives them advice on how to reach a satisfactory compromise. They are also the one who asks for time-off accruals, if necessary, and make requests for advancement opportunities in the company.

What is retained salary in a professional networking context means that the amount the employee is able to receive depends in large part on the success of the networking effort. A new business contacts an employee with whom they are interested in doing business. The employee informs the company what is retained salary, and the company realizes that if they want to get the person to work for them, then they are going to have to offer a substantial retainer. The employee then uses these funds to invest in marketing or product development, or to purchase materials that will further promote the company.

So, what is retained salary in a contract negotiation is not what the employee actually receives in a typical employment contract. What is retained salary is what the prospective employee is able to get as a bonus, stock option, or other compensation award from the employer following an engagement. What is retained salary also includes any tips and winnings from the performance of the employee. These benefits are most often awarded to newly promoted employees, or those with high levels of experience. Sometimes, companies award performance bonuses, which are based on the actual number of hours the employee worked in a specific department during a particular month, or the number of clients served.

What is retained salary also has an impact on the way performance reviews are doled out. If the company is willing to pay the employee for their services, then they will want to see the same level of performance during the performance review as was seen in the past. Thus, it may be necessary to increase what is retained in the contract. This way, the employee is showing progress in turning around an undesirable area and is being rewarded for it. On the other hand, if the review is determined to be unfair, then it may be necessary to reduce what is retained in a contract to appease the superior.

What is retained salary in a contract negotiation is not an amount that the employee can demand or even threaten to ask for during a negotiation. What is retained salary is typically agreed upon before a contract is signed. In this way, both sides have an interest in what is retained, and the company doesn’t have to worry about upsetting the employee and their agent. In the case of an offer based on a promotion, this may be enough to sway the employee into accepting the company’s offer. On the other hand, a demotion can be a much tougher sell for most employees, and one that they aren’t going to ask for or want to accept just to avoid losing the promotion.

What is retained salary is usually set annually, although it can be affected by holidays, vacations and other such events. This means that a company needs to keep careful track of what is retained. It can be very difficult for a company to get the employee to agree to a two or three year contract during peak earnings times. For this reason, the company may opt to offer a lump sum, which is much more reasonable than asking for a long-term commitment. What is retained salary also ensures that there is financial security for a company, as well as peace of mind for the employee.