Specify if workers must stay to collect bonuses — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
  • LinkedIn
  • YouTube
  • Twitter
  • Facebook
  • Google+

Specify if workers must stay to collect bonuses

Get PDF file

by on
in Human Resources

Q. Our company pays quarterly and annual bonuses (depending on the position). If an employee is here throughout the entire quarter/year, but leaves before the bonuses are paid out, is he still entitled to the bonus? Our company has no written documentation stating that you must be employed at the time the bonus is paid. —J.S., Colorado

A. It depends. We can't fully answer your question without knowing how your company calculates its bonuses. Employees who achieve certain sales goals, for example, have a strong argument that they're entitled to their bonus even if it is paid out after they leave. That's as long as there's no policy in place that the worker must be employed when the bonus is paid.

In the event of a lawsuit, the court will examine, among other things, the company's past practice and all oral statements concerning the issue. Prepare a written policy about the payment of bonuses. If bonuses are discretionary, your policy should say so. If you want to restrict bonuses to current employees, your policy should say that, too.

Leave a Comment

Previous post:

Next post: