Motivation is the sense of encouragement and an attitude influenced by various job-related factors such as salary, rewards, supervision, and others. It is crucial for managers, supervisors, and administrators to determine the factors necessary for driving improved performance and understand its significance in terms of job satisfaction and productivity, both of which significantly impact overall job performance. The Performance-Based Bonus (PBB) represents a novel type of incentive granted to government employees based on their individual work performance. This differs from other existing government bonuses that are distributed universally to all employees, regardless of their performance, as introduced in Fiscal Year 2012, under Executive Order No. 801.Current research about the effect of the performance-based bonus is varied and little research exists which describes the experience that teachers have. The primary objective of undertaking this study was to find out whether the Performance-Based Bonus is an effective motivator or stress inducer to the teachers and staff of the selected DepEd Schools in Iligan City. This study was conducted in Villa Verde Elementary School, Tambo Central School, and Tomas Cabili National High School. There were seventy-one (71) respondents who participated in this research by answering a self-constructed questionnaire. It has been found in this study that a significant portion of the participants fall within the 30-39 age range, and the majority of respondents were female, married and were bachelor’s degree holders. It was discovered that majority of the respondents are married and have completed their undergraduate degrees. According to the tabulated gathered data, on Performance Based Bonus as an effective motivator, it revealed that the highest calculated mean derived from statement no. 6 is 4.17, indicates a strong agreement. This implies that majority of respondents agreed that the performance-based bonus (PBB) is an effective motivator on their work performance. On the other hand, on Performance Based Bonus as stress inducer, it is realized that the highest calculated mean from statement no. 2 is 3.03 and is marked as neither agree nor disagree. This implies that most respondents are neither agreeing nor disagreeing that the implementation of PBB is a stress inducer. In general, the respondents showed a strong agreement that the Performance Based Bonuses an effective motivator.