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

Answers:

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.


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.