Annual and Quarterly Bonuses
lashefHR
23 Posts
Hi - does anyone have any suggestions for how to word a comp plan for people who receive quarterly or annual bonuses. I would like to be able to only pay the bonuses if the employee is still employed with the company at the end of the quarter or at the end of the year. Does that make sense? Currently we state that if an employee leaves the company for any reason they are paid their bonus up to the date of termination. We would like to change that to say that they must be employed through the end of the quarter or at the end of the year to be eligible...I just can't find the correct words...Any help would be appreciated.
Comments
I think you keep it simple -
"$1000 quarterly bonus based on current MBO's. Must have worked the entire quarter to be eligible for that quarter's bonus."
I think you keep it simple -
"$1000 quarterly bonus based on current MBO's. Must have worked the entire quarter to be eligible for that quarter's bonus."
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The language I use is something like this:
"In order to have earned and to be paid <commisions, bonus, whatever>, you must have been employed for the entire <time span> and employed on the pay date on which the <commission, bonus, whatever> check is scheduled to be disbursed. If you quit for any reason or violate any policy of the Company resulting in the termination of your employment relationship with the Company prior to the day any <bonus, commission, whatevrer> check is scheduled to be disbursed, you agree that you shall not receive that check and you agree that you shall not have earned it."
Without a lot of work, you can add language to pro rate the BCW for partially worked periods of consideration. In sales positions, that matters. In other positions, it may not make sense.