Can an employer deduct their 401k contributions from a profit sharing bonus on a salaried employee if written in the employment contract?
Get Legal Help Today
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
Can an employer deduct their 401k contributions from a profit sharing bonus on a salaried employee if written in the employment contract?
That is, at year end $10,000 bonus is zeroed out due to employer contribution to 401k throughout the year.
Asked on July 7, 2015 under Employment Labor Law, Arizona
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 9 years ago | Contributor
There is no legal obligation on employers to 401k contributions, so they can put any terms, conditions, etc. that they like, regarding the amount, the source, repayment of amounts advanced by the company, etc. If there was a written contract stating that company 401k contributions may be recouped from a proft sharing bonus plan, that is legal and enforceable.
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.