Can an employee successfully sue their company over shorted bonuses in NY?
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Can an employee successfully sue their company over shorted bonuses in NY?
I was recently informed that the bonus I believed to be receiving was going to be
60 of that total. The reason being the Board changed the plan half way through
the fiscal year, but that information was never communicated to the employees.
There were also two revenue plans and employees were never told which was the
target. The company did not issue a bonus plan at any point of the year, but in prior
years, the prior program, had been carried over. Do I have a legal challenge
against this and will my employment be put in jeopardy? This is a performance
based bonus and I am a long tenured employee in good standing with the company.
Asked on May 12, 2019 under Employment Labor Law, New York
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 4 years ago | Contributor
If the bonus was not merely performance based but was reflected in a signed written bonus or employment agreement from the company--that is, you had a written contract guarantying the bonus--then you could sue for breach of contract if they don't pay you the amount they contracted to pay, based upon the provable performance.
But if the bonus was not encapsulated in a written contract, it was subject to change at will by the company.
You write that the "company did not issue a bonus plan at any point during the year, but in prior years, the prior program had been carried over." That means that there was no in-effect written bonus agreement. The carrying over of prior plans in prior years was voluntary or discretionary on the company's part: they chose to do that, but were not required to do so, and could choose to NOT do so at will.
Therefore, based on what you write, you do not appear to have an enforceable guaranty of or right to a given bonus, and would not have recourse.
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