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Can the employer claw back bonus payments?

Gütersloh (dpa/tmn) – Your employer has promised you a bonus payment and now suddenly wants to reduce it or even cancel it? What causes frustration among many employees is often not even allowed. Johannes Schipp, a specialist lawyer for labor law, explains the legal situation.

Bonus payments are usually tied to specific performance or goals. They represent additional compensation that goes beyond the standard salary. Important: Employees are entitled to the bonus if they have provided the agreed performance. “The employer cannot then actively withdraw this bonus, simply because it cannot reduce or demand back the normal salary,” Schipp said.

Date contracts are often not effective

Some employment contracts include so-called deadline rules. These state that the employee will lose the bonus if he or she no longer works for the company before a certain date, for example December 1st. Such contracts are often intended to prevent employees from quitting shortly after the benefit is paid.

But such deals have their limits. According to Schipp, the Federal Labor Court (BAG) recently made it clear in a decision in July 2024 that such clauses in many cases represent an unreasonable disadvantage for the employee and as that they are ineffective.

Bonuses cannot be changed easily

And what happens if the employer suddenly wants to make changes to the bonus payments during a project? According to Schipp, this is also inappropriate: “If I promise a bonus, that’s part of the contract and the employer can’t just change it afterwards.” This also applies if the contract was not recorded in writing – an oral promise is sufficient to establish a claim for payment.

About the person: Johannes Schipp is a specialized lawyer for labor law, a member of the German Bar Association (DAV) and was chairman of the executive committee of the labor law working group in the DAV until 2021.

2024-10-20 23:06:00
#employer #claw #bonus #payments

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Gütersloh (dpa/tmn) - Your employer has promised you a bonus payment and now suddenly wants to reduce it or even cancel it? What causes frustration among many employees is often not even allowed. Johannes Schipp, a specialist lawyer for labor law, explains the legal situation.

Bonus payments are usually tied to specific performance or goals. They represent additional compensation that goes beyond the standard salary. Important: Employees are entitled to the bonus if they have provided the agreed performance. "The employer cannot then actively withdraw this bonus, simply because it cannot reduce or demand back the normal salary," Schipp said.

Date contracts are often not effective

Some employment contracts include so-called deadline rules. These state that the employee will lose the bonus if he or she no longer works for the company before a certain date, for example December 1st. Such contracts are often intended to prevent employees from quitting shortly after the benefit is paid.

But such deals have their limits. According to Schipp, the Federal Labor Court (BAG) recently made it clear in a decision in July 2024 that such clauses in many cases represent an unreasonable disadvantage for the employee and as that they are ineffective.

Bonuses cannot be changed easily

And what happens if the employer suddenly wants to make changes to the bonus payments during a project? According to Schipp, this is also inappropriate: "If I promise a bonus, that's part of the contract and the employer can't just change it afterwards." This also applies if the contract was not recorded in writing - an oral promise is sufficient to establish a claim for payment.

About the person: Johannes Schipp is a specialized lawyer for labor law, a member of the German Bar Association (DAV) and was chairman of the executive committee of the labor law working group in the DAV until 2021.

 

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