Legal Question in Employment Law in New Jersey

Non-payment of bonus after termination.

On Dec 5, 2003 I was told by the new CEO that I was being terminated because he wanted to hire a CFO in the office where he was going to be working. He advised me that my severance agreement would be honored, but that NO bonus would be paid.

A significant component of my compensation is an Annual Discretionary Bonus. The award and amount of which ''shall be determined at the sole discretion of the Company in accordance with the Company�s compensation policy and will be based on my job performance and the overall financial performance of the Company.'' I know others are receiving bonuses, and nobody has ever said that my performance was poor. Do I have grounds for complaint?


Asked on 12/16/03, 3:56 pm

3 Answers from Attorneys

Stephen Loeb Law Office of Stephen R. Loeb

Re: Non-payment of bonus after termination.

You mught, if you have a contract spelling out the terms of your arrangement or if you have an employee handbook which speaks in those terms. The bottom line is you have to show that a bonus was part of your contract and you did everyhting that you could to fulfill the contract. In the alternative if you can show that you are being discriminated against and you are in a protected class you may be able to file suit regarding the dismissal over your status.

Should you like to discuss this or any other legal matter, you can call my office to schedule an appointment for a consultation or in the alternative, I can be reached for on-phone low-cost legal consultation at 1-800-275-5336 x0233699.

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Answered on 12/16/03, 4:11 pm
Albert Van-Lare The Law Office of Albert Van-Lare

Re: Non-payment of bonus after termination.

You always have grounds for complaints. No one can take that from you. You should secure the services of an attorney to exploit the possibilities of payment of your bonus. I understand that it is discretionary but you should ask since others have been paid and you contributed to the company's efforts

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Answered on 12/16/03, 4:11 pm
Thomas Luz Pearce & Luz LLP

Re: Non-payment of bonus after termination.

The previous two replies are from attorneys who want you to call them and pay them for services. Mr. Van Lare's response is nakedly self-interested and has no legal support. Mr. Loeb's is better, in that he tells you that, in order to win, you need a written contract or an employee handbook that rises to that level. He doesn't tell you that you chances of winning a lawsuit are slim to none.

The word "discretionary" is all anyone needs to hear. Based on what you said in your posting, you are an employee at will with no right to any bonus at all. Courts in New York do not invent obligations that have no contractual basis, and will not do so here.

As to whether you can threaten a lawsuit and shake the company down for a few shekels even though you have no right to anything, I leave that to my more opportunistic colleagues.

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Answered on 12/17/03, 9:47 am


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