Leaving... been screwed out of annual bonus.
Discussion
Hi all,
So, I leave my job in April. At the start of this financial year the company was told we would get a bonus depending on company revenue. It's likely to be about 7-8% of salary.
I tendered my resignation a few days ago (4 weeks' notice) and have received a letter accepting it. In this letter it states that company bonuses are at the discretion of directors and I won't be getting a bonus.
I suspect I'm screwed, as it's not part of my employment contract. But a bonus should be for the last year's work I've done, which has been good. I have a very bitter taste in my mouth right now.
Am I stuffed?
So, I leave my job in April. At the start of this financial year the company was told we would get a bonus depending on company revenue. It's likely to be about 7-8% of salary.
I tendered my resignation a few days ago (4 weeks' notice) and have received a letter accepting it. In this letter it states that company bonuses are at the discretion of directors and I won't be getting a bonus.
I suspect I'm screwed, as it's not part of my employment contract. But a bonus should be for the last year's work I've done, which has been good. I have a very bitter taste in my mouth right now.
Am I stuffed?
I've never seen anyone get a bonus having resigned. Does leave a slightly bitter taste - even more so when the company you work for pays the bonus for the previous financial year a few months after it's ended and you've worked that full year.
That's the game though... if it bothers you try and negotiate a larger salary for less bonus next time.
That's the game though... if it bothers you try and negotiate a larger salary for less bonus next time.
Sounds not very nice BUT from an employers POV, a bonus isn't really a 'reward for the work you did last year'. It is a flexible motivation device for keeping employees.
You are leaving, so there is no benefit at all to paying you a bonus. If they use a rec con to find a replacement for you, it will cost them 20% of salary in rec con fees - so you leaving is costing them money.
You are leaving, so there is no benefit at all to paying you a bonus. If they use a rec con to find a replacement for you, it will cost them 20% of salary in rec con fees - so you leaving is costing them money.
johnfm said:
Sounds not very nice BUT from an employers POV, a bonus isn't really a 'reward for the work you did last year'. It is a flexible motivation device for keeping employees.
In some places this might be case, but where I work the bonus is very much sold as a reward for company performance. The value of it is determined by company revenue for the year just past, on a sliding scale where more revenue = more %.It is used as a motivation tool at the start of the financial year to encourage good work.
I was due a small bonus in March of 2011, essentially for the performance in 2010. I left in January of 2011, and received nothing, obviously.
The reason I left early was because the new job wanted me as soon as possible, and I wanted to join them as soon as possible. This meant forfeiting, but it was worth it in the long-run.
Quite a few people tender their resignations immediately on confirming a bonus has cleared into their bank account. Which makes sense.
Sorry chap, I guess you're not getting anything.
The reason I left early was because the new job wanted me as soon as possible, and I wanted to join them as soon as possible. This meant forfeiting, but it was worth it in the long-run.
Quite a few people tender their resignations immediately on confirming a bonus has cleared into their bank account. Which makes sense.
Sorry chap, I guess you're not getting anything.
Simbu said:
johnfm said:
Sounds not very nice BUT from an employers POV, a bonus isn't really a 'reward for the work you did last year'. It is a flexible motivation device for keeping employees.
In some places this might be case, but where I work the bonus is very much sold as a reward for company performance.louiebaby said:
I was due a small bonus in March of 2011, essentially for the performance in 2010. I left in January of 2011, and received nothing, obviously.
The reason I left early was because the new job wanted me as soon as possible, and I wanted to join them as soon as possible. This meant forfeiting, but it was worth it in the long-run.
Quite a few people tender their resignations immediately on confirming a bonus has cleared into their bank account. Which makes sense.
Sorry chap, I guess you're not getting anything.
Unfortunately waiting until my bonus had cleared isn't an option - my new job starts too soon. As i said, the new job is well worth the sacrifice if i have to make it.The reason I left early was because the new job wanted me as soon as possible, and I wanted to join them as soon as possible. This meant forfeiting, but it was worth it in the long-run.
Quite a few people tender their resignations immediately on confirming a bonus has cleared into their bank account. Which makes sense.
Sorry chap, I guess you're not getting anything.
I will still be in the employ of my current place when bonuses get paid. Everyone in the business will be receiving this except me. I really don't want to look at any legal stuff, but it sounds discriminatory in a large way.
I'll be having a chat with the HR manager this afternoon about it, explaining my point of view as in my previous post.
Simbu said:
johnfm said:
Sounds not very nice BUT from an employers POV, a bonus isn't really a 'reward for the work you did last year'. It is a flexible motivation device for keeping employees.
In some places this might be case, but where I work the bonus is very much sold as a reward for company performance. The value of it is determined by company revenue for the year just past, on a sliding scale where more revenue = more %.It is used as a motivation tool at the start of the financial year to encourage good work.
They may say you will get a max bonus of £10k. The bonus is calculated based 50% on company performance (<98% target revenue, 100%-103% target reveneu, >103% target revenue), 20% tean performance and 30% individual performance (based against whatever team and individual KPIs they set.
This allows them to 'fairly' calculate bonus for different peole without being accused of arbitrary rewards or penalties.
BUT, fundamentally the bonus is to keep staff they want from leaving. It is a carrot. As soon as you handed in your notice there was no need for the carrot.
What you should have done is negotiated with your new employer on the basis that if they want you ASAP, they need to cover the 7% bonus OR pay X relocation expenses.
Zaxxon said:
OP, I had to make the same decision back in 2001 when I left a shipping company to go and work for Merrill Lynch. It wan't nice at the time but the extra pay from ML and the experience I gained there far outweighed any bonus.
All the best with you new role.
Thanks All the best with you new role.
This is absolutely the view I'm taking when it comes to the bigger picture. I'm going from a small-ish ltd company (~£6m turnover) to a huge multinational. The jobs don't compare and I'm getting something like a 18% raise in the move.
However, I had plans for that money and the decision they've made, I think, is very poor.
Simbu said:
However, I had plans for that money and the decision they've made, I think, is very poor.
Not from their point of view it isn't.Completely standard to not receive a bonus if you resign. Quite ioften its written into a contract.
Why on earth would you expect it any other way?
Simbu said:
However, I had plans for that money and the decision they've made, I think, is very poor.
Never have plans for discretionary bonus - you will always be disappointed.Sounds to me like they made the right decision to not pay one. If they paid you a bonus it could encourage others to resign at the end of the year but still get paid.
Sebo said:
Sounds to me like they made the right decision to not pay one. If they paid you a bonus it could encourage others to resign at the end of the year but still get paid.
This arguement is not relevant in my opinion. If i'd resigned in April they would have the exact same problem. As it happens I had to resign in March.Simbu said:
This arguement is not relevant in my opinion. If i'd resigned in April they would have the exact same problem. As it happens I had to resign in March.
Get a grip. As others have said, a bonus is in incentive to stay. It may not be sold that way, but that's exactly what it is. You're not staying, so you don't get a bonus. If it's anything like ours, your company policy on bonuses will be explicit - no bonus to people working their notice period.
scotal said:
Why on earth would you expect it any other way?
Interesting.I see a bonus as a payment in respect of recognition of the work you have put in over and above that which would be expected for your usual salary which has resulted in the company performing better in that past year than it would have done so if you had worked purely in satisfaction of your contract of employment.
As such I see it as an incentive to work harder than strictly required to earn the company more money to enable them to reward the labour you have put in that past year. Not something to make you stay, but to repay what you have put in.
As such, whilst the OP might well be legless in legally challenging the decision I, personally, see it as a spiteful and vindictive "f
k You!" from the old employer and very poor form.Great for the old company in the sort term, but at what potential cost? I might even consider the decision with my new employer and see what their view is in relation to references and so on in light of this as, in the OP’s shoes, I would be feeling a work to rule situation coming on and am not sure I would bend over backwards in assisting any handovers. My phone would certainly be unanswered if they needed to check anything after I had left.
Rude-boy said:
Interesting.
I see a bonus as a payment in respect of recognition of the work you have put in over and above that which would be expected for your usual salary which has resulted in the company performing better in that past year than it would have done so if you had worked purely in satisfaction of your contract of employment.
As such I see it as an incentive to work harder than strictly required to earn the company more money to enable them to reward the labour you have put in that past year. Not something to make you stay, but to repay what you have put in.
As such, whilst the OP might well be legless in legally challenging the decision I, personally, see it as a spiteful and vindictive "fk You!" from the old employer and very poor form.
Great for the old company in the sort term, but at what potential cost? I might even consider the decision with my new employer and see what their view is in relation to references and so on in light of this as, in the OP’s shoes, I would be feeling a work to rule situation coming on and am not sure I would bend over backwards in assisting any handovers. My phone would certainly be unanswered if they needed to check anything after I had left.
Even if when you signed your contract of employment, it clearly stated that was the terms of the bonus plan? I see a bonus as a payment in respect of recognition of the work you have put in over and above that which would be expected for your usual salary which has resulted in the company performing better in that past year than it would have done so if you had worked purely in satisfaction of your contract of employment.
As such I see it as an incentive to work harder than strictly required to earn the company more money to enable them to reward the labour you have put in that past year. Not something to make you stay, but to repay what you have put in.
As such, whilst the OP might well be legless in legally challenging the decision I, personally, see it as a spiteful and vindictive "f
k You!" from the old employer and very poor form.Great for the old company in the sort term, but at what potential cost? I might even consider the decision with my new employer and see what their view is in relation to references and so on in light of this as, in the OP’s shoes, I would be feeling a work to rule situation coming on and am not sure I would bend over backwards in assisting any handovers. My phone would certainly be unanswered if they needed to check anything after I had left.
Rude-boy said:
As such I see it as an incentive to work harder than strictly required to earn the company more money to enable them to reward the labour you have put in that past year. Not something to make you stay, but to repay what you have put in.
As such, whilst the OP might well be legless in legally challenging the decision I, personally, see it as a spiteful and vindictive "fk You!" from the old employer and very poor form.
If you came to an agreement with the wife that if she has sex with you twice a day every day for a year you'd buy her a new car. And she did. But at the car dealers she started going at it with the dealer on his desk in front of you. Would you still buy her the car? Or would you file for divorce?As such, whilst the OP might well be legless in legally challenging the decision I, personally, see it as a spiteful and vindictive "f
k You!" from the old employer and very poor form.The OP has terminated the marriage before getting his good boy/girl prize. No marriage, no prize.
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