Legal Question in Employment Law in California

Payback of sign-on bonus for breech of length of service contract

My company said orally they were hiring me to perform specific work. I signed a contract stating they would pay me a sign-on bonus in exchange for 2 years of service. If I worked less than 1 year I would have to pay back 100% of the bonus, less than 2 years, 50%. Several promises were made that were not kept. My employer did not facilitate the work for which they said they were hiring me. Also, my manager said in my evaluation he would promote me to supervisor and never followed through. I accepted a manager position with another company,ending my service contract 5 months early. Am I obligated to pay back 50% of the bonus or should I only have to pay a pro rata of the bonus for the service time not performed? HR is stonewalling my negotiation attempts. Can I use their failed promises of promotion, etc. as legal leverage against them? In other words, I signed the contract in ''good faith'' that they would indeed have me perform the functions they said they were hiring me for. Had I known this would not be the case, I would have signed on with a different company.


Asked on 5/19/06, 5:33 pm

1 Answer from Attorneys
Michael Kirschbaum Law Offices of Michael R. Kirschbaum

Re: Payback of sign-on bonus for breech of length of service contract

There is a rule of law that says you cannot use oral promises to alter the terms of a written agreement. If the employer breached the terms of the written agreement, you may be excused from completing the terms of the contract, but I have serious doubt you will be able to keep the unearned portion of the bonus.

You may be able to allege you were fraudulently induced into signing the contract, to void the contract altogether. But even then, a court may require you to return half the bonus, unless you can show additional damages resulting from the fraud.

I think you need to have an attorney review the contract and the facts of the case, in detail, to more properly advise you on how to proceed.

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Answered on 5/25/06, 6:26 pm


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