Bonus or allowance?

When does an allowance cross the line to become a bonus? When it’s more than $1 million, judging by the proxy filed by Hewlett-Packard (HPQ) late yesterday. Though the details of both CEO Mark Hurd and CIO Randy Mott’s compensation packages, including generous relocation benefits, were widely reported when both men were hired, the language that HP chose to descibe the two payments is interesting.

While Mott received a $1 million “relocation allowance”, Hurd received a $2.75 million “relocation bonus”. What’s the difference between an allowance and a bonus? About $1.75 million, apparently.

So for all those readers who happen to be parents: when your kid asks you for an allowance, breathe a big sigh of relief. Using HP’s logic, they could have asked for a bonus instead.