If you are referring to a bonus plan that is paid at year-end and is available broadly across the company to people in leadership and technical roles, then you should know that many technology companies do pay more frequently than once/year. Many pay quarterly. The question of whether the payment is a “draw” or a payment for year-to-date results may be one of semantics.

Some technology companies pay quarterly for results that quarter. In this case, each quarter stands alone and there is no concept of a draw.

Some pay quarterly as long as year-to-date results meet certain criteria – this version could be considered a draw in the sense that the plan design is an annual plan with a quarterly payout mechanism. Usually any accelerated over-target payout is reserved for year-end when the total year results are available and overall over-performance can be verified.

I have assumed here that you are not asking about sales compensation plans, where draws are more common. These are generally offered in roles where sales people have a smaller portion of their total target compensation in a fixed base (less than 60% or so), and a highly seasonal business. For these roles, the draw is needed to keep cash flow stable during the “off season.”

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