If someone puts in 2-weeks prior to end of year bonuses going out, should they still expect to get one? Curious to get some feedback...

No. You will get walked out and no bonus, most likely.

Wait until the week after and the check has cleared.

Thanks for the feedback. Just to clarify, this isn't in reference to me. This is for an employee.

If the employee is not employed at year end, they have no claim to year end bonus. If an employee gives their notice in the month of December, expect to get walked and not get the year end bonus.

This is a little different. The employee put in notice prior to end of year going out, but checks will be given out during the two weeks they are still here. End of year is not guaranteed, is not based on commissions, etc, but can still be a a decent amount.
Not sure why they couldn't wait another week, but they didn't...

Would be interested in an HR attorney opinion, but since I slept at a holiday inn one time.

Since we are an at will state in Texas, your employment is at will. So is my decision to employ you. Absent an employment contract, your pay rate is agreed when you begin work, subject to change. This is usually done in writing, but does not have to be. It can change as well. I can give you a raise or reduce your compensation. You can ask for more money as well.

Point being that the employer is usually on ly bound by the agreed rate of pay through your last date of work. Bonuses are typically only deemed earn at the time of payment. Again, unless explicitly in writing to the contrary.

All the above ignores any minimum wage requirements, overtime, and you can absolutely open yourself up to discrimination and unfair treatment claims by being an ass in compensation. But Texas is very employer friendly when it comes to compensation. Worker beware.

If they earned the bonus they should be paid the bonus. It would be greedy and short sighted not to. The other side of this question is "Should an employee go to work after they put in their 2 weeks notice?"

The two weeks notice is a formality and not required. I wouldn't give any notice if I knew my employer was going to withhold any amount of money from me.

If they're not employed at year end, they didn't earn a year end bonus. They're not there at the end of the year.

"checks will be given out during the two weeks they are still here"

"Puts in 2-weeks prior to end of year bonuses going out"
" End of year is not guaranteed"

The real answer to this question requires a deeper analysis into the industry, the employee, the amount of the bonus, etc. If it was me then I would lean heavily towards paying it. The damage that can be done through social media would far outweigh the benefits of me keeping the money they earned.

I'm an accountant, not an HR person. Having said that does the employer have a handbook? If so what does it say? If it's silent on this kind of thing that's your first mistake.

I've typically worked with the rule that a bonus is due if the person is an employee in good standing on the day it's paid and I've never had HR object to that policy. If they gave notice and it was accepted and everyone agrees they will work the final two weeks then they are in good standing until the end of their notice period. If they were shown the door and will be paid two weeks severance instead of working they are in good standing until the end of their notice period. Only way I'd say not to pay it would be if it's scheduled to be paid to EVERYONE after their agreed upon last day. In other words don't change their schedule but pay everyone else.

The smart decision is to treat them like an employee in good standing until they are no longer an employee in good standing. Giving notice and working through that period means they are still contributing to the company and should be afforded the respect that comes with doing things the right way. Withholding a year end bonus from someone courteous enough to give two weeks notice just tells the next person that leaves not to give notice which ultimately hurts the company more than the bonus that was withheld.

I'm with Loyal (and an accountant as well). Barring an HR policy that I'm required to stick with that prevents it, I'd pay it. If they earned it during the year and were still there at payout time, then I'd pay it. My view is they held up their end of the terms of the bonus, so I would hold up mine. It's also a small world and my reputation is worth more than that to me. Just cleaner to pay and move on in good terms.

And speaking from a Fortune 100 company, our policy is that we pay it as long as you met the terms to earn it and were still employed on that payroll date even if notice came before. I have seen this exact situation.

It should definitely be i the handbook, but If the person is still employed on the day it's paid then they should get paid as well in my opinion.

The company doesn't have to accept the two weeks notice if they're really that concerned about paying out the bonus.

I'm sure there is nothing in the handbook about bonuses at all. They are not based on commissions, sales, etc. they are not based on position as in, if you have x position you get y bonus on this date at the end of year. They are completely discretionary so I'm not sure what the handbook could even say about them..."you may get a bonus at some point towards the end of the year pending the financial success of the company and your display of value"?
I do appreciate the feedback so far.

In that case, I'd still pay it assuming they made a valuable contribution to the success of the company that year and are still employed when it's being paid. People move these days. I just think it's best to leave things on good terms and pay for the contribution they made to the year.

In my industry, it's pretty standard you need to be working there then. Now, most people are smart enough to know not to give notice before payout and I've hired many people with start dates that allowed for their notice after bonus payout.

In this case, it's discretionary and likely would base on quality of employee over their tenure, length of tenure, etc.

what loyal said.

if there is no criteria clearly set by the company, you may not be "legally" required to pay it.. but it could still bite you.

Our bonus criteria is clearly set.. must be employed last day of fiscal (May 31) but bonus is not paid out until first paycheck in August. If you leave June 1st, you still get paid the bonus in August.

I am currently about to pay one that fits this situation. They could have easily waited until it was received, but have high character and chose to act honorably. I'll do the same and pay.

I've also been on the receiving end years ago. Had a $26k profit based bonus that I was willing to walk away from at year end late during the credit crisis. Certainly would have hurt to not collect that, but would have hurt my integrity more to resign just after receipt. My employer at the time recognized what I did for them and paid anyway.

Doing the right thing isn't that hard.... assuming you are in a culture that values doing the right thing.

oldarmy76 said:

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I'm sure there is nothing in the handbook about bonuses at all. They are not based on commissions, sales, etc. they are not based on position as in, if you have x position you get y bonus on this date at the end of year. They are completely discretionary so I'm not sure what the handbook could even say about them..."you may get a bonus at some point towards the end of the year pending the financial success of the company and your display of value"?
I do appreciate the feedback so far.

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When it comes to compensation you should at least have something like that in there, especially to make sure everyone knows it's completely random whether they are paid or not. Id highly recommend coming up with more concrete criteria even if you have to build in "outs". Screwing with peoples compensation is the easiest way to kill morale and destroy the culture.

It is normal practice everywhere I've been that you have to be there to get a bonus.

Now this is situation may be a little murky on that point.

But one thing not murky is the other stipulation on every bonus program I've been a part of: "Subject to management discretion"

Frankly, if this guy is dumb enough / short-sighted enough to give notice right before bonus being paid, I'm not going to feel too bad not paying him. It doesn't seem as though he thinks through decisions too well.

OP's message needs to self-destruct and open a new thread after bonus has been paid.

IrishTxAggie said:

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If the employee is not employed at year end, they have no claim to year end bonus. If an employee gives their notice in the month of December, expect to get walked and not get the year end bonus.

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this is probably better left answered by an employee handbook. Being employed for 95+% of the year might be a little less matter of fact.

If it's a big company, there will be a stand alone policy document, a plan document around the bonus program, or a reference to it in a handbook that will spell it out (which helps the company avoid problems)

Most of the time they take a pro-employer stance and say you have to be employed and in good standing to receive, and they also put language in that gives the supervisor some extra discretion.

But I've definitely seen some plans that favored the employee - so it's worth checking

one of my former companies would pay it out if earned. If they did the year of work and brought value, then they deserve it.

I wouldn't pay it unless I liked the person and wished them well.

I had employees that I really cared for, and some that I wanted to get rid of but couldn't because they were just competent enough to not get fired.

Everyone knows that a bonus is not guaranteed. If it was it would just be salary.

one of our employees got her $5,000 Christmas bonus, then quit first week of January. smart.

Normally the emp handbook addresses this. Often bonuses and unpaid commissions are waived

Whether the bonus is owed typically depends on the language in the employment/bonus agreement (or the language in the handbook if it covers bonuses).

If there is no agreement or handbook covering the situation, then it's somewhat of a grey area and depends on whether the employee "earned" the bonus before he quit or was fired, which can be hard to prove/disprove. You don't have to worry about this grey area if the employment/bonus agreement are properly drafted. Although, the situation of the employee giving notice and then the bonus getting paid before the notice is up is a situation that I haven't seen (because most employees would just wait a week and give notice after the bonus is paid).

Feel free to email me at mavsfan4ever at hotmail dot com if you want to discuss specifics.

Smart people know that post bonus payout is "decommit szn"

I'd give the employee in question a 12-month subscription to the Jelly of the Month Club.

That's the gift that keeps giving the whole year long.

Tumble Weed said:

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I wouldn't pay it unless I liked the person and wished them well.

I had employees that I really cared for, and some that I wanted to get rid of but couldn't because they were just competent enough to not get fired.

Everyone knows that a bonus is not guaranteed. If it was it would just be salary.

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I would never do anything based on "if I liked the person"....that seems very dangerous, even in an employer friendly state like Texas (assuming you're here)...

JDCAG (NOT Colin) said:

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Tumble Weed said:

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I wouldn't pay it unless I liked the person and wished them well.

I had employees that I really cared for, and some that I wanted to get rid of but couldn't because they were just competent enough to not get fired.

Everyone knows that a bonus is not guaranteed. If it was it would just be salary.

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I would never do anything based on "if I liked the person"....that seems very dangerous, even in an employer friendly state like Texas (assuming you're here)...

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Being likable is underrated. I learned a long time ago that it is more important to be liked than to be right.

When you are an a-hole everyone just wants to see you trip up and fail. When you are liked, everyone is rooting for your success. I have met several idiots with prosperous careers based on this simple fact.

I see a case for both sides. I have a friend who got burned out of an investment banking bonus because he felt he was doing the right thing by being open and honest with his employer.

One thing to consider: this employee will be walking and talking down the halls the same day all the other employees get their bonus.

It certainly sends a message to the rest to play their cards super close to the vest when they decide to exit, which isn't exactly helpful. And in general, I just think it risks making you look bad to your on-going employees. Some may be on the the side of company deciding not to pay, but I'd imagine many won't and think it's kind of a low, cheapskate move. I want my folks to feel good about our integrity and what we do. To some, it's not an integrity issue, but to others, it is.