Non-payment of annual performance bonus (variable pay)

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Querist : Anonymous

Querist : Anonymous (Querist)

07 October 2016 Dear friends,
I want your help in understanding what are the options an employee will have if he/she is not paid his/her annual performance bonus (variable pay). The variable pay figure has been mentioned clearly in the offer letter/appointment letter. The wordings in the offer letter are : In addition to your salary, Rs. 1,00,000 per annum as performance bonus will be awarded at the discretion of the management after appraisal of the successful performance of the employee and the financial performance of the company.
In this case, let us assume that the performance of the company and employee are fine. Even then if the employer does not pay, then what are the options of the employee to receive this amount?

Regards.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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07 October 2016 This amount is payable at the discretion of the management as per appointment letter. So you can only request the management to pay the amount. Management has the right to accept your request and pay the amount or reject your request.

Querist : Anonymous

Querist : Anonymous (Querist)

07 October 2016 Agreed. But it also says that discretion of the management after appraisal of the successful performance of the employee and financial performance of the company. Hence, in this scenario the performance of the employee and company are good. So, whether it can be still contested or not is the question?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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07 October 2016 It can't be contested in view of the condition of discretion of the management.

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