If my employer is unable to provide the work that it offered in my contract, must I repay a sign-on bonus if I quit?

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If my employer is unable to provide the work that it offered in my contract, must I repay a sign-on bonus if I quit?

I signed a contract stating that I would work a specified number of hours in a specified location for 3 years in order to keep a sign on bonus. I’ve quit the company after 2 1/2 years because the company often required me to drive up to 100 miles beyond my district for work, and I was offered less than the required number of hours. The contract was not a guarantee of employment. Am I justified in refusing to pay back the sign-on bonus? They have sent me an invoice asking for the full amount to be repaid. The contract is to be interpreted according to IL law.

Asked on August 14, 2011 Alaska

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

If they don't ask for the money back, you don't need to do anything. If they do ask for it back, if it's enough to justify hiring an attorney to fight for it (e.g., say, more than $1,500 or $2,000, though get estimates from an attorney about the cost before retaining him or her), you should do so. The problem is, while you may have been fine had you waited three years, you left after 2 1/2. By the terms of the contract which you describe, you would have had to repay if you didn't get the requisite hours within 3 years. By quitting early, you arguably yourself breached the agreement by prevening or precluding them from giving you those hours--e.g., they had another 6 months in which to give you hours. Under this theory, you would have to repay. You would try to counter that either by claiming that it was numerically impossible for them to give you enough hours in the last 6 months, so you were justified in pre-emptively or anticipitorially [sp?] terminating the agreement before the 3 year period; or alternately, that you were constructively (or effectively) terminated by the company due to their forcing you to do excessive and not contemplated (at the time you were hired) travel. However, neither of those arguments is an easy one to make and prove, and on the face of it, your quitting early was a breach of your obliations--that's why, to fight this, if they seek the money, you should get an attorney. If the amount of the bonus is not large enough to justify an attorney, if the employer seeks its repayment, you may wish to repay.


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