It has always been my personal belief that end-of-year bonuses (especially large ones) just mean you were underpaid all along.
Not necessarily. I (like others) always used bonuses for performance 'above and beyond' that which is expected for fully satisfactory work. In this case, the employer wanted to thank the employees who have stuck around and helped the business grow. He's even helped with their tax situation by putting some of the bonus into their 401Ks.
Diverging for a moment...the Japanese have a very interesting way of ensuring fully satisfactory performance and rewarding above average. Over the course of the year each employee is paid 80% of their salary. At year-end, if performance has been satisfactory, they get the other 20% as a lump sum. If performance is unsatisfactory, they get less than 20%...and, if above average, they get more than the 20%.
