Can my employer refuse to give me my “guaranteed” bonus?

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Can my employer refuse to give me my “guaranteed” bonus?

My offer letter stated, verbatim, “…. plus a 10% guaranteed bonus”. The bonus time of has passed, and my boss told me that nobody got their bonus, not him or his boss, etc. However, my offer letter did not say “may” or “eligible for”… It said, “guaranteed”. What action can I take, if any, to get my bonus?

Asked on April 19, 2012 under Employment Labor Law, New York

Answers:

Richard Southard / Law Office of Richard Southard

Answered 9 years ago | Contributor

You need an attorney to review all of the terms of your contract to see what options are available.  On the surface, it seems as if they are in breach of the contract but you may be limited in terms of what remedy is available based on one of the other contract provisions.  Any attorney here would only be guessing until they actually read the contract at issue.

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

If the bonus truly was guaranteed contractually, you should have been paid it--contracts are, after all, enforceable, and their terms bind both parties. If you are not paid it, you could sue your employer for breach of contract to get the money. Probably a good first step would be to bring the contract to an employment law or business litigation attorney to review with you--the lawyer can review the language (contracts are governed by their language) and verify that the bonus has no discretionary or variable element and therefore that you should have been paid. The lawyer can also let you know about the cost involved in taking legal action, and any potential pitfalls or concerns (e.g., if the company is economically failing and may go out of business or declare bankruptcy, even if you sue and win, you may be unable to collect the money). You can then make an informed decision as to whether to initiate legal action or not.


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