In the other type, the landowner, after leasing, may sell portions of royalty interest in the lease. This is not a fee interest, but a share of the production of oil or gas under this lease, and expires with the termination of the lease. In this respect, it is similar to an overriding royalty.
Usually this is after a lease has been granted for the development of the property and there appears to be a prospect of future production. The purchase is usually made by an investor or royalty dealer. The principal issues encountered here are the treatment of acquisition costs and deductions for worthlessness losses claimed as a result of unsuccessful exploration.
The small investor may maintain ledger control accounts of producing royalties and nonproducing royalties. These are supported by separate accounting for each property interest particularly producing properties and usually showing the property interest owned. The landowner usually has the recorded instruments of conveyance for inspection if they are needed.
The larger investor may maintain control accounts of Producing Royalties and Nonproducing Royalties, and a subsidiary record known as a Royalty and Fee Land Record for each royalty interest owned. Such record shows the property, location, description, interest owned, from whom acquired, date acquired, cost, lease information, and record of rentals received. When verifying cost for an investor who has claimed an abandonment loss, the agent should verify that the cost has been removed from the subsidiary record as well as the control account.
Part 4. Examining Process
The cost may have been written off for tax purposes without appropriate charges on the books. When a royalty becomes a producing property, the investment account is transferred from the Non-producing Royalties account to the Producing Royalties account. At this point, the property should be shown in the return as income producing property subject to depletion.
The royalty dealer usually watches oil company leasing operations very closely. When an area of interest is identified, the dealer begins purchasing the fee royalties in the area. The dealer usually has certain investors with whom it regularly deals, and to whom a portion of the royalty interest is acquired, retaining a small fraction as its own investment. The dealer usually sells a portion of the royalty obtained for a greater sum than the entire cost of the interest obtained. A fraction of the cost corresponding to the fractional interest is retained.
The investor or dealer should capitalize, as part of the cost of royalties, commissions, title examination and recording fees, travel expense, or other expenses incurred in connection with the acquisition of the royalty interest. If a single sum was capitalized as cost of the royalty, this may indicate that some of the above acquisition costs were charged to expense. This would require an analysis of certain expense accounts. Amounts paid or incurred for geological and geophysical before enactment of the Energy Tax Incentives Act of should be capitalized pursuant to Rev. However, amounts paid or incurred for geological and geophysical activity after enactment of the Energy Bill should be amortized over two years under IRC h.
After May 17, , the geological and geophysical amortization amount for certain integrated oil companies was extended to five years. Acquisition costs must also be allocated to the cost basis of the specific royalties acquired. Where multiple royalties are acquired, it may be difficult to determine the accuracy of the taxpayer's allocation of travel, geological, geophysical expenses, and general office expenses. The interests of an investor or operator in mineral deposits as well as the rights to share in the production from such deposits are governed by the terms of a leasing contract or supporting agreement.
Through these contracts there may be numerous assignments, conveyances, and dispositions of interest or rights. By analyzing the various leasing contracts and the resulting tax consequences, the examiner can pick up leads to potential tax adjustments. A substantial amount of examination time can be spent on such analyses and is often a productive and important examination step. The oil and gas lease has progressed from a simple instrument to a complex document. Most leases contain eight principal elements:.
Date — Determines the precedence of documents. Habendum clause — Fixes the duration of the lease interest. If production is not attained in the time specified, often called the primary term, the lease expires by its own terms. Granting clause — Specifies what the lessor has granted and the consideration paid. Royalty clause — Sets out the principal inducement, aside from the cash consideration, for the property owner to sign the agreement. Drilling and delay rental clauses — One of the primary considerations in an oil and gas lease is the early development of the property.
Drilling and delay rental clauses specify the manner in which early drilling can be deferred. This may be done for a specified period by the payment to lessors of delay rentals. However, drilling cannot be deferred past the primary term of the lease without voiding the lease. Description of the property — An accurate description of the property is necessary. A system of land measurements known as the "Rectangular System" is used today in most oil-producing states. Areas of some oil-producing states, however, are not laid out in this system but are surveyed in parcels, sometimes in irregular geometric patterns.
Special considerations — Additional clauses may be inserted in a lease agreement to more fully describe the rights and duties of the parties; such as, drilling restriction near buildings, right to unitize or pool lands, or right to use surface facilities. While most leasing contracts may contain these basic elements, variations in their wording and meaning abound. These contracts vary to such an extent that it would be impractical to talk in terms of a "typical contract. A lease is a contract between a landowner or mineral owner lessor and a second party lessee. The lessor grants to the lessee the exclusive right to drill for and produce oil, gas, or other minerals on the property described in the lease.
A lease usually provides for:. Cash lease bonus payable to the lessor upon the execution of the lease and approval of the title. Delay rental for each expiring year during which the lessee has not commenced drilling operations. Continuation of the contract between the lessor and lessee as long as oil or gas is produced from the property.
The lessor's share of the production is known as the royalty interest or landowner's royalty. This is the working interest and is burdened with the costs of development and operation. The amount of production designated as the landowner's royalty has become fixed by custom. In addition, such landowner may be able to obtain a larger lease bonus in a lump sum or installments. In lieu of a bonus, the lessor and lessee may prefer a minimum guaranteed royalty arrangement.
This might be the most advantageous position for both parties. The lessee does not undertake a specific obligation to develop the property or to pay delay rentals, but does agree that the lease will expire if the property is not developed or rentals are not paid. Ordinarily, the lessee can abandon the property without penalty.
It is customary, however, for the lessee to formally terminate the lease if the lessee desires to surrender the property without development. Leases are frequently acquired in what is known as blocks. The usual procedure is for geologists and geophysicists to make certain preliminary surveys of the surface conditions.
Core drilling along public highways and other forms of study of the topmost layers of the earth may be indicative of the patterns of folds in the earth's strata at greater depths. If the survey indicates the area is promising for the development of oil or gas, oil company agents acquire leases covering the desired area. Further geological and geophysical work is performed to determine the most favorable portions of the area and whether subsurface structures appear favorable for drilling.
Based on this information, certain portions of the acreage may be dropped, and the remainder retained for future development and operation. In many parts of the country, the mineral or executory rights under a particular tract of land may be owned as an undivided interest by several persons. Each person may lease only the part owned. As a result of this, as many as three or four different operators frequently acquire an undivided interest in the leasehold under a tract of land.
Thus, the leasing document does not indicate the extent of ownership of the signatory parties. To determine ownership, it may be necessary to study a division order if property is productive or an abstract. When examining the lease record for properties acquired during the year, pay particular attention to the amount of rent per acre per year.
You may find something to indicate payments other than normal delay rental. In most areas, delay rentals are relatively small compared to lease bonuses. The period covered by the lease should be noted, as well as any provisions with respect to terms and expiration. The purpose is to be sure an installment bonus is not recorded as a delay rental.
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If it is found that the annual payments are for a fixed number of years regardless of production and if the lessee is unable to avoid such payments by terminating the lease, such annual payments are installment bonus payments and should be capitalized by the lessee as part of the cost of the lease. These payments would be found in the lease rental expense account, but the nature of the payments would be determinable by examination of the provisions of the lease itself.
However, a cash-method taxpayer who receives an installment bonus contract as consideration for an oil or gas lease must include its value in gross income for the year in which the lease is executed if the obligation is transferable and readily saleable. See Rev. A production payment retained in a leasing transaction is treated as bonus paid in installments. See IRC j and Treas. The production payment is not taxable when the lease is made by the landowner, only as oil income is received. Oil and gas lease agreements generally provide for the lessee to begin drilling for oil and gas on the property within one year after the granting of the lease.
If drilling has not begun within this period of time, the lease agreement will either expire or provide for the payment of a sum of money in order for the lessee to retain the lease without developing the property. These payments are known as "delay rental" payments and are made in order to be granted additional time in which to drill and develop the leased property. The purpose and the rights granted by the payments of the rental must be examined to determine whether the payments are actually "delay rentals," lease bonus, or royalty payments.
Delay rentals are not payments for oil or gas to be produced. They are paid for the privilege of retaining the lease without drilling for up to another year. Delay rentals are ordinary income to the recipient and are not subject to the depletion deduction. The payment of delay rentals are preproduction costs which are required to be capitalized to the depletable basis of the lease pursuant to IRC A if the lease is held for development or if development is reasonably likely at some future date.
A small operator may keep a simple set of records. A large operator will probably keep a rather complex system of records. Each operator maintains separate accounts of producing and nonproducing properties. The large operator usually has a greater number of control accounts and more detailed subsidiary records. Separate control accounts may be carried for Equipment and Intangible Drilling and Development Costs. Each control account is supported by records. The subsidiary ledger for nonproducing leases is generally maintained in accordance with geographic location by states, subdivided by counties, with each lease bearing an identification number.
This record shows the name of the lease, number of acres covered, legal description, county, state, bonus paid, date of lease, term expiration date, the interest owned, royalty, override, from whom acquired, rental per acre, by whom title examined, other interests, assignments, and rental payment record. This lease record provides a quick and ready reference to any nonproducing property owned without the necessity for consulting the lease file; however, some taxpayers do not maintain a separate lease file.
The total costs of nonproducing properties are recorded in the control account, and a subsidiary record of cost by leases is kept. Some companies make direct charges to the subsidiary nonproducing lease records, while others enter charges in a suspense account for accumulation, and then clear the suspense account by a single entry to the subsidiary lease record. In order to ascertain that all capital costs are included in the lease record, an analysis of the charges to the lease record or to the suspense account should be made.
The items which should appear in these accounts on each lease are the lease bonus, abstract costs, abstract examination fee, filing fee, delay rentals, and travel expense.
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In addition, there should be charged any commissions paid for obtaining the lease. The cost of a quiet-title suit should also be capitalized. As leases become productive, the record is transferred to producing lease accounts. The acquisition costs of the underdeveloped leases are transferred to leasehold costs on the producing lease records, to which other costs, capital in nature, in connection with development are added. When a lease terminates without production, the account is transferred to an account for surrendered and expired leases.
Generally, lease bonuses are properly capitalized by the payor. It is quite common to find that other items have not been capitalized by the taxpayer and must be capitalized by the agent during the examination. This requires the close examination of certain accounts and records of expenditures.
In the oil and gas industry the requirement to capitalize these types of costs is primarily governed by:. Temporary Treas. Taxpayers may also elect to apply these temporary regulations for taxable years beginning on or after January 1, See T. IRC a. However, IRC c still requires an allocation of the portion of overhead that is "directly or clearly related" to IDC-type activity. The standard is discussed in PLR which cited several court cases. The following excerpts indicate that it is based on facts and circumstances:.
In the oil and gas industry no uniform pattern of business operations exists and each taxpayer's drilling operations will have to be carefully studied to ascertain the types of overhead expenditures that are directly related to IDC. Each item of general and administrative overhead must be examined to determine whether it is, in whole or in part, related to the drilling and development activity.
A portion of the rental expense of the headquarters of a small oil and gas company may be incident to and necessary for the drilling and development activity where the headquarters facilitates the coordination of the company's various activities, including drilling. A substantial portion of the president's salary and related overhead may also be attributed to IDC. The amount of rental expense, which is attributable to IDC, might be determined on the basis of actual floor space devoted to coordination of the company's drilling and development activities.
A portion of the legal fees incurred by an oil company for services provided by an attorney retained by the company is incident to and necessary for the drilling of wells to the extent that these expenditures would be incurred in connection with negotiating and drafting drilling contracts. The amount of legal fees attributable to IDC might be determined on the basis of the proportion of time spent by the attorney in negotiating and drafting the drilling contracts [versus other billable activities].
Also, included in IDC would be the portion of the costs, including overhead of geologists, and field engineers, together with support clerical staff whose major function is to acquire new oil sites and supervise the drilling and development of such sites. In the event that a relationship is established between an overhead item and both the drilling and development activity and other activities of the taxpayer, such item may appropriately be allocated on some reasonable basis between IDC and other activities.
A major oil company would operate substantially differently from a small independent producer. In that case only the cost related to the departments directly involve with lease acquisition, contract negotiation and drill site development can be attributed to IDC. Since IDC is fully deductible in many circumstances, examiners should perform a risk analysis of switching ordinary expense to IDC, including the impact on AMT liability. The examiner can also ask the taxpayer to identify how much, if any, overhead was added to its direct IDC costs primarily fees paid to drilling contractors.
Companies that serve as the operator of joint ventures routinely charge overhead on IDC to the other working interest owners. If the overhead level for IDC on wells the taxpayer drills on its own account is substantially less, it should be asked to provide an explanation. Generally speaking, even though the amount of overhead is based on facts and circumstance, for most operators it will be at least 5 percent of their direct IDC costs.
IRC A. The UNICAP rules generally require taxpayers that produce real property and tangible personal property to capitalize all the direct costs of producing the property and the property's properly allocable share of indirect costs, regardless of whether the property is sold or used in the taxpayer's trade or business. To capitalize means to include costs in the basis of property that is produced or in inventory costs rather than to deduct them as a current expense. The costs are recovered through deductions for depreciation, depletion, amortization, or cost of goods sold when the property is placed in service, sold, or otherwise disposed of.
The regulations under Treas. These regulations generally apply to all costs required to be capitalized under IRC A a except for interest. The capitalization of interest is covered under A f and Treas. Interest expense is capitalized when real property, such as oil and gas property, is "produced". The amount of interest expense will depend on an interest rate reflecting an "avoided cost of debt" , the "production period" of the asset, and the cost of the asset.
Companies in the upstream oil and gas sector routinely produce tangible property in the form of wells, separators, tank batteries, and gathering lines which are generally considered personal property since the MACRS class life is only 14 years Asset class Whether interest must be capitalized will depend on the production period and estimated cost. Those items are discussed at length in Treas. An extensive review of these regulations is beyond the scope of this IRM. On the contrary, since the class life for assets used in Pipeline Transportation Oil and gas companies in the upstream sector also produce offshore platforms.
Whether a "jacket type" platform is an "inherently permanent structure" and should be considered real property for purposes of IRC A f , was addressed in CCA July 1, , transmitting WTA-N While a floating deepwater platform is affixed to the seabed in a different manner than a jacket type platform, it has some of the same characteristics.
The total UNICAP costs that have been added to depreciable property that was placed in service during the tax year is to be reported on Line 23 of Form , Depreciation and Amortization. If the amount seems negligible a review of the taxpayer's methodology in arriving at the figure may be warranted. To determine if the taxpayer is including any UNICAP costs in the basis of its leases, examiners should focus on high cost leases such as offshore tracts that recently underwent their initial drilling phase.
Assume that the appropriate "avoided debt" interest rate for a taxpayer is 5 percent. Companies in the natural gas marketing and transportation sectors may acquire gas for resale. Cushion gas is the portion of gas stored in an underground storage facility or reservoir that is required to maintain the level of pressure necessary for operation of the facility. However, IRC A applies to costs incurred by a taxpayer relating to natural gas acquired for resale to the extent such costs are properly allocable to emergency gas.
Emergency gas is natural gas stored in an underground storage facility or reservoir for use during periods of unusually heavy customer demand. Other gas in the storage facility that is available to meet customer demand often called "working gas" is subject to IRC A. Temporary regulations 1. The following discussion assumes that an examination of these types of costs is permitted by the aforementioned directive.
Because of the length of the temporary regulations, an exhaustive review will not be provided here; however, three important areas impact the oil and gas industry: whether an amount is paid to acquire or produce a unit of real or personal property see 1. Examiners will find that the regulations under IRC A are referenced throughout the new tangible regulations.
For example, 1. However, the temporary regulation refers to IRC A for the treatment of employee compensation and overhead costs required to be capitalized to property produced by the taxpayer or to property acquired for resale. Example 4 of 1. Rather, they must capitalize the geological and geophysical costs separately and amortize them as required under IRC h.
Examiners who focus on refinery improvements and turnaround costs will want to closely review the guidelines for unit of property for "Plant Property" that are found in Treas. Examiners who focus on pipeline improvements and repairs will want to closely review the statements regarding unit of property for "Network Assets" found in Treas. Agents are encouraged to contact industry subject matter experts for the latest developments in this technical area.
These expenditures can also include the cost of acquiring well logs and core data, sometimes called "bottom-hole data" , which pertains to wells drilled by other companies. In recent years the capability of seismic technology has increased dramatically, especially in regards to offshore exploration, drilling and production activities.
Data processing and digital imaging have been greatly enhanced by the use of extemely powerful computers and advanced computer modeling techniques. The clarity of seismic surveys has been greatly increased with the advent of "3D" seismic surveys which are achieved by running tightly spaced seismic lines over the entire survey area. In some very large oil fields 3D surveys are conducted periodically known as "4D" surveys and evaluated to determine the extent which fluids have moved within the reservoir over time in response to the withdrawal of oil and gas and the injection of water.
During drilling operations, sensors that are located in the drill string can collect seismic data "ahead of the drill bit" which can be used to optimize drilling parameters such as mud weight, drill path and casing points. An example of a direct cost would be the licensing fee paid to a vendor for the right to use a seismic survey it conducted. Examples of indirect costs would be the salaries of employees who evaluate the survey and overhead of the department which performs the computer processing of the survey.
On occasion the evaluation and processing is done by vendors or consultants. Examiners should be aware that for financial accounting purposes such costs are routinely charged to expense. Such accounts should be analyzed for geological and geophysical expenditures. For most oil and gas companies, amounts paid or incurred after August 8, with respect to domestic properties are amortized over a month period under IRC section h. The half-year convention specified in IRC h 2 results in the amortization deduction being spread over three tax years.
For certain "major integrated oil companies" defined in IRC h 5 the amortization period is extended to five years for expenses incurred after May 17, and seven years for expenses incurred after December 19, Examiners should note that the definition in IRC h 5 is unique, and could encompass the foreign refining operations for related entities. For example, a U. The assistance of an engineer will generally be needed in the examination of these expenditures. The definition of IDC in Treas.
An IRS engineer may have to be consulted if that situation arises. Legal expenses should be examined for charges for examination of abstracts, filing fees, quiet-title suits, and other items which should be capitalized as lease costs. General office expense or sundry expense accounts will often reveal charges applicable to lease acquisition costs.
Expenditures for travel incurred in the acquisition of leases must be capitalized and allocated to the leases involved. Analyze travel and other expenditures to determine those relative to the individuals instrumental in acquiring leases. Then relate these expenditures to leases comparing the locations and times of travel with the dates the leases were acquired. The original mineral owner lessor or a sublessor may contract for an advance royalty on transfer of the operating interest.
Advance royalties result from lease provisions that require the operating interest owner to pay a specified royalty a fixed amount or an amount based on royalties due on a specified production level regardless of whether there is any oil or gas extracted within the period for which the royalty is due.
Advance royalties also allow the lessee to apply any amount paid on account of oil and gas not extracted against royalties due on production in subsequent periods. Generally, the payor of an advanced royalty can deduct the advanced royalty from gross income for the year in which the oil or gas on account of which it was paid is sold. However, advanced royalties that result from a minimum royalty provision may, at the option of the payor, be deducted in the year paid or accrued.
For leases entered prior to October 29, , this option to deduct in the year paid or accrued was available for all advance royalties. The option, however, is a one-time election for the taxpayer and, once chosen, cannot be changed. A minimum royalty provision requires that a substantially uniform amount of royalties be paid at least annually either over the life of the lease or for a period of at least 20 years in the absence of mineral production requiring payment of aggregate royalties in a greater amount.
The example in paragraph 1 above is not a minimum royalty. Depletion is generally allowable in the year the oil or gas is produced under IRC A. However, the Supreme Court decided in the consolidated cases of Fred L. Engle and Phillip D. Farmar dated January 10, , that percentage depletion is allowable on oil and gas lease bonuses and advance royalty income.
See Commissioner v. Engle, US The IRS stated in a news release dated May 18, , that the depletion deduction could be taken in the year payment is received or accrued by the payee. Refer to Announcement , IRB Examination of the lease record which would include the royalty agreement , the journal entries recording minimum royalty transactions, and the related ledger accounts are proper steps to verify these transactions.
If a lease expires, any capitalized cost of the lease becomes a loss, even though the taxpayer may subsequently obtain a new lease on the property. If, prior to the expiration of a lease, a new lease is obtained covering the property, it is known as a top lease. In this case, the cost of the prior lease should not be allowed as a loss; and any bonus and other costs incurred in obtaining the renewal lease should be capitalized. In such event, the costs of both the old and new leases are included in the capital account of the property.
During the examination, look for top leasing transactions. Taxpayers frequently write off the cost of the original lease. Leases are carried under an identification number. The renewal may be noted by an "R" immediately after the lease number. Otherwise, compare the leases claimed as expirations with the new leases to see if the same property is involved.
Another method is to ask the taxpayer if there are any top leases. Quite often when a top lease is taken, the new lease will have a completely different number than the old lease. To find leases which have been charged off even though top leased, it may be necessary to compare the locations of the abandonments with the company's current holdings on a company land map. The land department will have one. If the new lease is obtained after the date of expiration of the old lease, the loss may be allowable. Of course, facts and circumstances are vital elements in each case.
An investment in minerals may be acquired by cash purchase, exchange of other property, services rendered, gift, inheritance, or liquidating dividends. In any transaction where different properties or assets are acquired, there may be the problem of allocation of the basis to the various properties or assets. In some contracts, the amount involving each separate property or asset may be stated.
When stated at realistic values, this eliminates the problem of allocation. Some apparently simple transactions require complex allocations of purchase price to an extent that engineer assistance will be needed. The geological and geophysical expenditures incurred in an area must be allocated to the leases acquired and retained therein. This can best be illustrated by the following example. The lease is for a term of 5 years and 6 months. Watch for this type of transaction.
This abandonment will appear as a credit to the leasehold account and a debit in the Expired and Surrendered Leases Expense. The leasehold account may explain this credit as "released acreage" when actually the company never had a lease on the acreage, but only an option. The lease record usually identifies a lease by its terms, bonus, acreage, and other provisions, thereby making it possible to identify each lease acquired. Remember that all of the geological and geophysical expenditures incurred in an area of interest are allocated to the acreage acquired and retained in the area.
The acreage not retained is outside of the area considered to be favorable for development, regardless of the fact that an option was obtained as a protective measure during the study.
An operator will sometimes purchase a block of leases from a broker in a lump sum purchase at the broker's purchase price plus a commission. Frequently, the broker's purchase price will be capitalized by the purchaser operator but the commission charged to expense. The entire cost to the operator should be capitalized and allocated to the lease acreage acquired in the purchase. You can identify this type of transaction by examining the commission expenses account and the purchase agreement.
These two sources of identification are usually sufficient. Look into the subsequent year to ascertain whether some undue tax advantage may have resulted from the allocation of the purchase price. An allocation of a disproportionate share of the purchase price may have been made to acreage considered undesirable and that would be released early, thus the retained acreage would have low leasehold costs.
When a producing property is purchased, the price paid must be allocated between leasehold and equipment. The cost basis is allocated between leasehold and equipment in proportion to their fair market value FMV. Refer to Rev. Upon finding that a taxpayer has acquired a group of properties for a lump sum, the agent should obtain from the taxpayer:.
The purchase of a group of producing properties, or a group of both producing and nonproducing properties, presents a complicated valuation problem. The best approach is to first allocate the total purchase price among the various properties. Although leasehold and equipment could be treated separately, at this point it is best to make allocations to each property.
This helps keep values in perspective. Leasehold and equipment together where applicable are treated as a property unit. The reason for this is that most engineering appraisals, upon which purchases are based, value leasehold and equipment together. Even the phone number that I had to get from my credit card says that the mailbox is full. Does anyone know how I can proceed with this cancellation? His weird clap is called an anchor it is a NLP technique basically what he is doing is getting his brain to feel a certain emotion on command using a physical gesture. Robbins is not for everyone and that is ok everyone has their opinions and is entitled to have them and I think if we all respected that the world would be a much better place.
However, what I would suggest is to anyone reading this is when attending any event focus only on the positive highlights and experiences you got out of it rather than any negatives. By doing so this will shift your mood, thought process and what you focus on and allow you to experience life to its fullest. Remember where attention goes energy flows. I think it is great that you left after one day - great decision! I went with a friend who really was interested in the event.
I stayed for four days to support my friend and did not enjoy the event. What was good about the event: - Focusing on some areas of your life to improve on and sharing this with others but this could have been achieved in half a day without the hype - Mostly friendly participants - The location at Qudos Bank Arena - I enjoyed when it was over and I could return to my quiet husband who is not full of hype.
The massage thing was creepy as hell and I simply refused to do it. The herd mentality was also scary. I had enough on the morning of the second day when they put us in groups and insisted that we wear colored bandanas like campers and "make noise" to outdo the other groups. It was rumored that we were going to be tasked with coming up with ways to solve the issues with check-in at the seminar which, to be fair, WAS a shit show.
I don't work for free, just saying. So I was OUT. Best decision I made in awhile. Well done to you! Sounds like my idea of a nightmare. Looking at his supercharged approach Too loud. Too brash. Too over the top. Too much. Very interesting, the things you mentioned that he did. I was at a Demartini talk many years ago. He also kept asking people to put up their hands; shout along, and he name dropped something terrible plus kept highlighting all his trips and yachts and etc.
Maybe this is a recipe being followed. I walked out of that talk 10 minutes in. It's all huge ego stuff - and these guys are making a fortune out of it. People are obviously desperate! I feel that Tony should be in prison. He lies. He says he is a Christian but cheats people out of property. He sells false hopes. A doctor would spend prison time for doing that. He makes money off the poor. You summed it up beautifully my friend. My partner and i flew interstate and attended our firstborn tony Robbins event.
However on the last day spent the day exploring the foreign city and made the most of our free time. We have taken a lot from the event in itself and William continue to explore more ways to enrich our lives away from fluff hype and high fives. I also left a seminar after day 1 lol I won a writing contest back in and went to his firewall seminar in New Jersey.
I totally agree with your assessment! I love tony robbins as well. He introduced me to some great strategies on change and the power of focus. I read some of his books and he even helped me wa t to study language more! So for that I am forever grateful to Tony! I left after day one because Tony is a master salesman! I saw people loving him too much and sort of treTi g him like a God!
Tony is not a God, he is a very powerful human being with extraordinary skill sets! I started to notice that people were more into him than his methods and everything was about money! It totally changed my outlook on seminars in general!!!! I do t want to become part of a cult following! I wanted to be inspired! I was inspired in the first day, after that it seemed like a bunch of sheep buying his products that just happened to be relevant to every subject he was teaching!!!! Unleashed my Power Within??? I so respect you for your honesty, individually and explaination of what worked for you and what didn't I think he is very sincere in what he does but I also think he feeds off of people who have deep emotional issues that were never addressed therefore fishing for people who want those needs acknowledged and even addressed.
He knows how to pull that out of anyone which in itself is honorable but the self righteous entitlement attitude that Not that it should be free but all that need it do not get access. I feel it is the rich getting richer by preying on the weak. It is exceptable today to take what you think you deserve. There is no limit to greed. It is a choice. He also teaches others to coach so when he is no longer doing it he can profit from teaching them the same thing he has done.
His fees are outrageous. I like his way of speaking but he is not a god nor is he infallible?. He is good at what he does. Hi Sir, I am from India. I am trying to improve my self since and still I am trying. According to my expectation I have not achieve anything. These are the issues I am facing currently and I want to get out of these. Communication issue. Language issue poor English I am salary person.
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However I have to pay high amount of EMI every month. Relationship issue. Feeling afraid negative thought almost every time. I have seen couple of videos as well. I have seen that you tought the people for different thinking process in difficult situation. Fair enough. Guy is a 21st century con man, he says some good things, he's also an ego maniac who has made a fortune like a tele evangelist convincing people to be good to themselves while extracting fortunes from them as well.
If he truly cares about human kind he would do these seminars for free. I found it to be the best event ever! It changed my life. Thanks for your honesty. We all make different decisions based on how we were raised and by our beliefs and I think it comes down to being open minded and commiting to what you set out to do. Is the line concave or convex. Both are right but which would you choose. I have gone twice to his UPW event. Yes i believe this is he is over priced, but no this even should not be free. And made amazing connections that aided my growth.
It only my opinion that it should be a little costly ish because No one values free. Same goes for my patients. I love helping people but all my free patients never put in work and I'm wasting my time and energy. If anyone is feeling drawn to go, I say go for it! Many doors opened for me. However, I would go in with little expectations, focus on what you want to achieve, and remain optimistic.
You will be surprised what you can get out of it. A couple of things come to mind. One, UPW is more for the person who is new to transformational work. Personally I had to step completely out of judgement over and over to gain the incredible value that I did from the UPW that I attended with 15k guests. Our 2fer promotion came with an Executive Upgrade so basically we were in the center.
That felt like a reasonable price. We weren't told that upfront so it felt a little shocking and disappointing. His stand-in was amazing however. The up-selling was painful. It was hard to trust that every time we got into a vulnerable state there was an enormous push to benefit from something that would pay him more money.
Products, workouts, clubs, and more courses. I think your article is a brilliant way to promote your brands and feels truly authentic. Thank you. I appreciate your giving your opinion on the first few hours of a Tony Robbins event. Day 1 is always about getting people in the right state to be able to receive and appropriately process those things you are learning. Had you attended the entire event, I suspect your opinion would have been vastly different. But you didn't, which means your views account for little to nothing because all of it is assumption and nothing based on fact.
But you do have many people reading this so you got what you were after - your name known by more people. Hi It was interesting to read your input on the T. R event I think I can somewhat relate and understand where you come from to some extent but I have to say that yes you do kind of bash T. Here in Sweden probably most people would think that an T. I dont think that MR Robbins would disagree with some of the things you pointed out. I think that he would see it as something positive that you follow through with what you feel is right for you.
His work is a possibility for people to get uplifted and recobnected with themselves. We should never blindly follow any person or teaching. Look at Buddha,even he himself Said question my teachings learn for yourself. You do not have to justify to anyone and explain why you do as you do when it comes to your own choices of this sort. It is important to ledsen how to trust ourselves? You are an experience richer; you realized it wasnt for you and Thats it.
Nothing more nothing less. No harm done. I think valuable from this is that you have inne guidance and knowledge of your own and that it is important to acknowledge it no matter what someone else says or does. So also it is natural that you will not ve inpressed by som things. Dont think too much of yourself though. Also maybe you should appologize even to T. R if he now is your client,this is not really appropriate,if not for that reason only I would say;. You say you do not bash him down. But you kind of do. No need to get personal and patronize people just to prove ones point.
There is no right nor wrong. But now I know. There is no way that suits ALL of us, and there ARE supposed to be many different ways in life because there is such a variaty in things here in the world. That having one way of doing things wouldnt be possible in and off itself. I once myself left an event not his , that I didnt feel was my thing. I just told the teacher it didnt feel right and that it wasnt for me.
It wasnt even possible to get a refound. Still though I felt happy for my experience and the nice people I had met during that first day but most of all I was happy for my own guidance sistem that told me which way to go. People rarely chose to think for themselves these days and also there's a lot of self doubt out there I know because I do.
I come from the country that in the previous era it was free and clear from bombardment of advertisers. In one word I walked out on a book written by another famous around the world author and I got no issues with not agreeing with someone on any given topic no matter how famous they are. No one is God here so use your judgement wisely. I have a 20 year old son who is struggling with low self esteem, procrastination. I thought that going through a powerful motivational course might just "awaken" something in him and push him out of his negative state I went through a dark period after losing my mother, sister and sorta got knocked out by life.
There is no magic formula, but there are changes you can make that help. It helped me a ton. It could help your son as well. It takes work, and time putting the work in. But if you do the work, building self-esteem is a side-effect. Great write up. Very insightful coming from someone who is a seasoned entrepreneur. Thanks for sharing. I absolutely respect your opinion of this. I believe tony shares some of Abraham Hicks ways to keep people happy excited and uplifted during his seminar.
Pray that you find absolute peace and joy and thereafter all other wants in life. God bless. I enjoyed the genuine opinions you've shared about your experience at Tony's seminar. My biggest takeaway is that you were looking for deep, insightful wisdom in the wrong place.
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His books, podcasts, videos, and training materials on the website are his preferred mediums for that. The purpose of the live show is to produce a "life-changing experience. He wants you to be awe-inspired, mesmerized and uplifted. He wants you to get outside of your normal frame of reference and the limitations of your day-to-day thoughts and environment, to see past your normal routine, and to inspire you with a kick start of energy so you can blast through the walls you've put up and move into a new headspace.
The shows are a gigantic charge of electricity to kick start your heart and motivate you to begin the process of change. Getting started is the hardest part. The shows are the adrenaline rush, the sensory overload most people need in order to get started in a new direction in their lives.
So basically your article is saying, "I walked out of the vegetable garden because they didn't offer the hamburger I was looking for, and you shouldn't waste your time in that garden because it has nothing of value to offer. The fact that you misunderstood the point of the live shows isn't a shortcoming of Tony's, and it certainly doesn't mean he's a fraud or that he's ineffective or has nothing of value to offer. It just means you showed up for the wrong reasons. This was refreshing and an appreciated perspective. It was an hour long and penetrated my consciousness just enough.
After reading your article I find myself wondering where speakers get their motivation and success, truly. Off the emotionally and mentally malnourished? The rich feeding on the poor? Achieving success the way TR has overtime can get to a person. Having to keep up with a lifestyle and a reputation. We sell our soul to the devil in the mix of it all. But I digress, thank you for writing this thoughtful article, for your effort and energy, and for taking the time to relay an otherwise unpopular message.
I did not enjoy it. I think you're brave. You're doing what most of people wouldn't do. After all it's your experience. I think you came to the seminar, took in just the amount you needed, then left when you were full of the catalysts of change you were seeking. Then you planned and enjoyed an empowering day of enjoyment your way. Amazing story. Simple You came, you saw, you left when you got what you needed, you implemented the things you learned where you could, you enjoyed a nice mini vacation.
I get it. I like your take on his overall experience. I get that people can become heavily invested in all the ways possible - time, money, effort, emotion etc. But I'm confident that even TR himself would admit, in his most honest moments, that it's not going to work for everyone, in spite of their being fully committed and genuinely well intended. It would be nice if we allowed for the devotees, the skeptics and those on the fence room enough to all have a say.
Buddy respectfully if your going to give a negative opinion about someone else's work first look in the mirror. Oh wait Have you seen your hands? You criticize his clap? Your petty with no reason to be either. You look so weird your photo could go viral for looking like a serial killer be honest. You also clearly don't understand how transformations occur based on your ignorant criticism of an immersion experience.
You should feel blessed that your opinion got even a spec of attention because it's half baked. Try again with some backbone next time. I thought that picture of you was a joke. I'm actually disappointed it wasnt Leave changing lives to those whose lives have proven it. The hypocrisy here is incredible.
I hope that nobody ever speaks to you the way you have to him, sounds like you need a lot of love and hugs. Great article, well written. I applaud you for using your inner guidance in meeting your needs. I almost bought a ticket. Thank you for being the first to share the experiences.
Thank you and good luck. I'm 74 and been involved with self improvement stuff most of my life. Tony's is the best I've ever worked with. Anybody can go into a seminar and get nothing out of it, because getting something out it is a skill in itself and you haven't developed that. However, good for you to find alternative things that do work for you. Buy the ticket. You won't regret it, even if others will.
I think everyone would learn the best like I did. Be so miserable you place yourself purposely in environments hoping someone takes you out of your misery cause your to scared to do it yourself, till one day your caught with a firearm and heroin and thrown in prison for 5 years. Alone, withdrawals, and time to serve, make it through that all, and be released with no one on the other side.
And yet, you decide that your sick of feeling sorry Andrew all the reasons you feel bad about yourself, and fix it. And find a way no matter what. Internally or externally. With no one. All you need is yourself, and maybe some light guidance from people placed in your path. They will come to you. Specially living in the age of information at our fingertips. Your voice was unexpected I have endured a similar experience. Hi Brooklyn.
For family trauma, I suggest family constellation or hypnotherapy as healing modalities. Check out Dr. Gabor Mate's books and videos, Dr. Mark Wolynne and Anthony Hubl. For hypnotherapy, check out Alba Weinman and Grace Smith. Best of luck. Family Constellation is great for systems issues. For personal trauma there is also Somatic Experiencing from Peter Levine. Also Rolfing Movement helps you with the body part of the change. Much more subtle and lasting.. And yes, I agree with the article. I have studied ALL of Robbins material, all the videos, cds, books, and i have also taken his coaching course.
I did not walk out of the UPW, but I wanted to. My husband was also there. But I did go to the bathroom everytime we had to jump, clap, shoult, hug everybody I wanted more, more content, not a rock concert. I still think he is a genius, but the large mass events are not useful. I attended attended a wealth expo in nj. Tony presented on sat the first day of the workshop.
He was very intense lot of Great info but the crowd was enormous people. The room was very hot. He spoke for about 5 hrs. Amazing he stayed up there that long. There was a lot of dancing and back rubbing. It was great to see him live but felt I gained more from reading his books, watching I tube videos and listening to cds. I have 11 years of college tough to retain a lot of info especially in bad seats and hot room.
I thank u for Sharing your story it would be better to attend an event like yours with a lot less people. I have never been to his full days events but I can relate to if you can self fulfill yoirself and on track with your goals and do not need extra motivation and can find inspiration other ways , the training might be too general.
I think everyone has the right to feel the way they do about anything, TR included, even if he's the best on the planet at what he does. I am of the opinion that anybody doing what he does may sound cheesy, weird, like they're a con or whatever negative things people may think of him. Nevertheless, he has made a name for himself, so I believe people get excited just by the thought of being 'led' or trained by him; he's got charisma, he's a star, not very different from Michael Jackson, for example, with all his weirdness.
We could say Michael left a much more significant legacy, that is, his music, his art, his moonwalk, but TR isn't that different - one day people will remember the weird clap, his voice, his mannerisms and stuff and say he was "awesome", unforgettable. As for his cursing yes, that bothers me too, I see no point in that whatsoever. Apart from that, I do think he's a great personality.
Now, would I have walked out on him? Maybe, maybe not. Maybe he lost momentum? He's only human, even if he himself does not remember that at times, he's human. Of course, but who isn't? We just don't have that big an audience in front of us, hypnotized by out words. If we did, I have no doubt we would behave as narcissistically as he does. Or perhaps worse? Great article. That, I respect. Thank You for voicing your truthful opinion.
There is free eBook sample up to sharing 4 if you are interested to read. I attended all of Tony's events and his leadership training 20 years ago. Still today I use and think of what I learned, and because I learned it, was able to survive and make it through "a time of incredibly unfortunate circumstances" that began 9 years ago. I did the work, many times, the fact that his style resonated with me was my 'good fortune'. I have never regretted the time or the money, certainly not the "embedded knowledge" into who I am now. Life took some turns, I survived, and then thrived.
I am happy. I hope you are too. Just out of curiosity.. I'm an ENTJ. Your article shouts of Analytical personality traits. Awesome stuff mate, power to ya. Thank you for honest feedback I experienced same thing at Noah St Johns one big long week of sale pitches. How could someone who genuinely wants to help people—all people who have struggles in life — charge thousands of dollars? If he were Retired I might let him slide!
Great comments! The thing that recently turned me off was his constant cursing he does. I saw the documentary I am Not Your Guru or something like that and was turned off because of his constant use of curse words. I am not a prude but I see no value in the constant use.
Just my opinion. Tony is a great speaker and motivator, but the rest of the speakers are just slick commercials trying to get you to buy and buy now!!! I felt like I paid good money to sit in a room and have people preach to me why I should part with my money and make them rich.
Buyer beware. Real Estate flips do NOT happen in 3 days. You are NOT using their money Investing in stocks, research yourself. Do your homework! They get rich, not you. Amazing how many stupid people fall for this! Opinions are my own. I watched one of his Netflix specials Honestly I think he's a great salesman teetering on being a con man You said it best about him thinking he's more enlightened than everyone else I noticed he just spouts off the first thing that comes to his head when he's trying to solve someone's deep problem and then acts like poof problem solved and his answer is like the word of God.
I think he's a narcassist. My experience with TR was hearing his advertisement on TV. His voice was incredibly loud and super positive. Like one of those salesmen that are super over the top,big smiley teeth bleating at you like you're going to die if you dont buy their product. The second experience was driving down to the mountain with my 4 kids and my sister who put his tape on. Having come from an environment where addiction and violence was rife and wanting to heal and grow,I listened, with no judgment. After I got back,I started feeling worse about myself.
It all seemed unachievable and over the top. Its all about eating, exercise, money,positive, positive, positive. Wham wham thank you man. No frigging breathe to take,no space to allow processing to take place and most of all,self empowerment comes from within not by someone dictating what someone else should do. A good therapists helps you to uncover you and doesn't try telling you that you need to spend thousands of dollars to come back cos you still need me. I feel that Tony himself is desperately trying to make money under the guise of fixing others and leading with his ego instead of healing himself.
He has a desperation about him. Loosing his voice will be his greatest gift where he will have to truly sit with himself and listen. Regards S. First, we sought to extend the time course of our experiment to examine the longer-term effects of prosocial bonuses. In Experiment 1, we measured job satisfaction immediately after the prosocial bonus, which we acknowledge is likely when the impact of giving was at its greatest. We assess more delayed or extended benefits of prosocial bonuses in Experiments 2a and 2b.
Second, we explored the impact of a different form of prosocial bonuses; to do so, we redirected generous spending from external charitable causes to co-workers and teammates within the organization. Third, Experiment 1 compared the effects of prosocial bonuses to a control condition; in Experiments 2a and 2b we directly compared the impact of prosocial and personal bonuses, by giving members of some teams money to spend on their teammates and members of other teams money to spend on themselves. Due to logistical reasons, a control condition could not be included in Experiments 2a and 2b.
Teams were approached in person by a research assistant in a recreation center on campus and invited to participate in a study. Members of participating teams completed a basic demographics survey in which they noted their age, gender, annual income and student status. Each team was randomly assigned to the personal or prosocial bonuses condition. Both personal and prosocial spending instructions were presented in written form and then explained by a research assistant to ensure participants understood the instructions.
Performance was assessed with the percentage of games won out of total games played on the date of the initial survey Time 1 and approximately two weeks later Time 2. One hundred and twelve salespersons at a Belgian pharmaceutical company were emailed by their Human Resources Department with an invitation to take part in an experiment. All of the salespersons indicated willingness to participate and provided their demographic information. Twenty-four salespeople were excluded from the experiment for various reasons.
Specifically, for ten salespersons we could not get performance data from the company. Some salespersons, for example, were active in two different sales territories, sharing their sales performance with multiple teams. Others were in charge of special projects for which we could not have access to a performance indicator. An additional fourteen salespersons who were team leaders were excluded as we wanted to examine giving among peers, rather than between employees and supervisors. Participants were assured that participation was voluntary and their responses would remain confidential.
The pharmaceutical salespersons worked in teams that were in charge of the same geographical region. Although each salesperson worked alone, team members would share strategic information about prospects e. Each sales team was randomly assigned to the prosocial or personal bonuses condition. Participants were informed that the funds were provided as part of a study conducted by independent researchers. All participants receiving funds to spend were asked to complete the spending by the end of the week. While one-third of the salespersons were assigned to be spenders i. Receivers were not informed that they would receive a gift from a co-worker.
In order to avoid confusion at the companywide event, participants assigned to be receivers and third-party observers also received envelopes with a brief note thanking them for their participation in the study but they were not informed of the spending manipulation. Everyone was instructed to open the envelopes alone at home. The twenty-four salespersons excluded from our study were not eligible to be spenders or receivers. We provided the company with the funds to be distributed to the salespersons, who were fully informed that the study was conducted only by independent researchers, and that the company would not have access to any of the data.
Performance was assessed immediately before Time 1 and one month after our spending intervention Time 2. Pharmaceutical salespeople promote their product to physicians, pharmacies, and hospitals, rather than selling directly to customers.
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As such, the standard indicator of pharmaceutical sales team success is the total monthly sales collected by each pharmaceutical sales team in Euros in the geographical region under their purview. Therefore, we used monthly team sales as our measure of team performance. Participants who received a personal or prosocial bonus were asked to report how they spent this money.
On personal bonus teams, spenders reported buying items for themselves such as sportswear, small jewelry, CDs, food, and alcohol. To confirm that there were no significant differences in initial performance, we entered condition personal bonus vs. Next, we examined the impact of prosocial vs. Another way to demonstrate the effectiveness of these interventions is to calculate the return on investment for prosocial and personal bonuses.
The salespeople who received a personal or prosocial bonus were asked to report how they spent the allotted funds. On personal bonus teams, spenders reported buying items for themselves such as food, alcohol and groceries. On prosocial bonus teams, spenders reported buying items for others such as gift card, chocolate, wine, and treating a teammate to lunch. As in Experiment 2a, to confirm that there were no significant differences in initial performance, we entered condition personal bonus vs.
Although the simple effect should be interpreted with caution given the very small sample size, closer examination suggests that prosocial bonuses were effective in improving performance from Time 1 to Time 2. Once again, it is possible to conceptualize the effectiveness of these interventions by calculating the return on investment for prosocial and personal bonuses. The results of Experiments 2a and 2b are similar; teams that received prosocial bonuses outperformed teams that were given personal bonuses. These results emerged despite the logistical and statistical limitations of samples of team data.
Indeed, the small sample size may explain why the effects are marginal in both experiments. Therefore, to more accurately estimate the true effect size of prosocial bonuses on performance, we conducted a meta-analysis. Meta-analyses are frequently used to combine the results of two or more studies, allowing researchers to arrive at more accurate conclusions than can be presented in a single study  — .
This method is advantageous when several experiments favor the same result but fail to reach significance due to small sample size . Taking this approach with our data, across Experiments 2a and 2b, we combined the effect sizes for the change from Time 1 to Time 2 performance in prosocial and personal teams.
These results from the meta-analysis show that the change in performance from pre- to post-bonuses was significant in prosocial teams while not significant in personal teams. We offer initial evidence of the causal impact of increasing prosocial behavior via the provision of prosocial bonuses to employees at an Australian bank, members of dodge ball teams in Canada, and pharmaceutical salespeople in Belgium. Taken together, our studies show that when organizations give employees the opportunity to spend money on others — whether their co-workers or those in need — both the employees and the company can benefit, with increased happiness and job satisfaction and even improved team performance.
In Experiments 2a and 2b, we extended these findings to team performance in the longer term, showing that teams performed better when participants were assigned to spend money on their fellow team members than when given a more standard bonus: money to spend on themselves. Unlike some research suggesting a weak link between factors that improve job satisfaction and those that improve job performance  —  our results suggest that prosocial bonuses have a meaningful impact on both metrics.
How might prosocial bonuses lead to increased happiness, job satisfaction and team performance? Because our studies were conducted in the field, we were unable to conduct extensive surveys assessing likely mediators of the impact of prosocial bonuses. While the beneficial impact of prosocial spending on happiness is well-established  ,  , a key goal for future research is to explore underlying mechanisms of the prosocial bonus-performance link, with several clear possibilities worthy of investigation.
First, prosocial bonuses may lead to the strengthening of existing relationships and even the formation of new relationships; such positive interpersonal relationships predict job engagement  ,  and job satisfaction  — . Second, and relatedly, prosocial bonuses might lead to increased cooperation and cohesiveness between team members, which can improve team performance in part by encouraging helping behaviors  — . Along similar lines, future work should examine whether the impact of prosocial bonuses on team performance is driven by actions of the spenders, receivers, or a combination of the two.
Since we were not able to measure individual performance in sales and sports teams, we could not pinpoint whether prosocial bonuses increased team performance by motivating individual-level contributions or team-level operations. Assessing individual level contributions would also allow researchers to examine how additional team members -- who were neither spenders nor receivers -- respond to this type of intervention.
Future experiments that include both prosocial and personal bonuses while assessing these — and other — constructs will add to our understanding of the benefits of prosocial bonuses. We note that Experiment 1 included a prosocial bonus condition and a control condition but not a personal bonus condition, whereas Experiments 2a and 2b included prosocial and personal bonus conditions but not a control condition; in addition, Experiment 1 included two levels of bonuses, whereas in Experiments 2a and 2b the bonus amount was kept constant.
These decisions were driven by logistics. Our study sites were not interested in including a personal bonus in Experiment 1 but did allow us to include two levels of prosocial bonus; they were interested in including both personal and prosocial bonuses of a fixed amount but not a control condition in Experiments 2a and 2b.
Of clear interest for future research is more systematic and comprehensive variation of all of these factors, crossing many bonus levels with both personal and prosocial bonuses. We suggest that this difference is likely due to the different form that prosocial bonuses took in the two studies. Recent research suggests that face-to-face giving has a larger impact on happiness than giving at a distance: not only are people more likely to donate money to toward single individuals than to larger organizations  —  , but the closer the link between giver and receiver, the bigger the happiness benefits: people who give money to others are happier when they give face-to-face rather than remotely, and spending money on close friends leads to more happiness than spending on more distant acquaintances  — .
Perhaps even more importantly, whereas in Experiment 1 employees were givers only, in Experiments 2a and 2b teammates were both givers and receivers: for every salesperson who gave a gift, there was a salesperson who received that gift, likely another contributor to the greater impact of prosocial bonuses in Experiments 2a and 2b.
Demand effects should have influenced both of the prosocial donation conditions e. Our experiments provide preliminary evidence for the potential utility of prosocial bonuses, though future research is needed. Given that existing incentive schemes have important drawbacks, it is worthwhile to consider creative new approaches to incentivizing employees. That said, we assume that prosocial bonuses may have drawbacks of their own, which future research should document. In particular, it seems likely that prosocial bonuses could backfire if they were introduced by companies as a replacement for more standard bonuses.
Because many companies already allocate funds for charitable giving and employee entertainment, however, it may be possible for companies to reap the benefits of prosocial bonuses by providing some of these existing funds directly to employees, who can then use this money to make donations to charity or to benefit co-workers—potentially increasing job satisfaction and performance in the process.
Relatedly, prosocial bonuses were unconditional in our experiments; future research could examine whether bonuses conditional on performance or based on competition would prove as effective in increasing job satisfaction and performance. We opened by noting that recent surveys indicate that job satisfaction is at a twenty-year low in the United States even as Americans have come to spend more and more of their time at work. This additional time at work, of course, often comes at the expense of devoting time to pursuits known to be linked to well-being, from forming social connections to engaging in prosocial acts such as volunteering  ,  — .
We suggest that rather than force employees to make a losing tradeoff between social life and work life, employers can focus instead on using prosocial bonuses to create a more altruistic, satisfying, and productive workplace. Browse Subject Areas? Click through the PLOS taxonomy to find articles in your field. Abstract In three field studies, we explore the impact of providing employees and teammates with prosocial bonuses , a novel type of bonus spent on others rather than on oneself.
Funding: The authors have no support or funding to report. Prosocial Bonuses We suggest that prosocial bonuses offer an alternative approach that has the potential to provide some of the same benefits as team-based compensation — increased social support, cohesion, and performance — while carrying fewer drawbacks. Overview of the Present Research We examine whether randomly assigning employees to engage in prosocial behavior — via prosocial bonuses — can have a causal impact on employee well-being, job satisfaction, and job performance.
Download: PPT. Design and procedure. Experiment 2a: Sports Teams Methods Participants. Team performance. Experiment 2b: Sales Teams Methods Participants. Design and Procedure. Results Experiment 1 Happiness.
Table 2. Change in happiness and job satisfaction between Time 1 and Time 2 as a function of condition Experiment 1. Job Satisfaction. Experiment 2a Spending examples. Spending condition and team performance. Table 3. Change in sports and sales team performance between Time 1 and Time 2 as a function of condition Experiments 2a and 2b.