Do I have to pay back an attendance bonus to a former employer who that they overpaid it?

Asked on February 1, 2016 under Employment Labor Law, Indiana


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 4 years ago | Contributor

The issue is what is meant by "overpaid." If that means that the way the bonus is calculated is transparent and/or readily known, and is based on something quantifiable, then if they made some factual or mathematical error, yes, you'd have to repay it. Say that you get a bonus if you work 100% of the work days in a quarter; they gave you the bonus, then realized that the payroll clerk made an error and you'd actually only worked 98% of the days and so were ineligible: in that case, you'd have to repay, and if you don't, they could sue you. A mathematical or record-keeping error does not entitle you to keep the money.
If the bonus was not based on something quantifiable but was discretionary--e.g. a manager simply decides who to bonus and who not, without firm, countable  targets--then it doesn't matter if they decided later that they should have paid you; once the company gives a discretionary bonus, they can't re-think it.

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