Is it legal for an employer to deduct an earned bonus because a timesheet was turned in late?
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Is it legal for an employer to deduct an earned bonus because a timesheet was turned in late?
I receive an hourly wage, plus tips, and non-discretionary bonuses. I turned my timesheet in a few days late and my employer said they would be deducting 1 of my bonuses because of the late timesheet. Is this legal?
Asked on February 17, 2016 under Employment Labor Law, California
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 8 years ago | Contributor
If the bonus was non-discretionary, it was awarded pursuant to targets, guidelines, rules, etc. That means that it could only be debited if there was some rule or provision, known in advance, that it would be reduced for turning in a timesheet late. Since a non-discretionary bonus is governed by the rules setting out when it must be paid, it cannot be arbitrarily or unilaterally reduced by the employer, the way a discretionary bonus can be. So if the entire bonus was non-discretionary, and if the rules governing it did not provide for deductions in this case, then it could not be debited; but if some part of it was discretionary, then that discretionary part could be reduced.
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