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Did you know: Even if you haven't guaranteed Paul's bonus, you could still be guilty of unfair labour practice if you don't pay him?

by , 04 November 2014
Let's say Paul's employment contract makes it clear that you don't guarantee he'll get a bonus.

Because of this, you assume you're covered and there's no way you could be guilty of unfair labour practice if you don't pay him.

Your assumption is wrong.

The truth is, even though you haven't guaranteed Paul's bonus, you could still be guilty of unfair labour practice if you don't pay him.

Here's why...


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Here's why you could still be guilty of unfair labour practice if you don't pay Paul's bonus

 
The Labour Law for Managers Loose Leaf Service explains that even if you haven't guaranteed your employee's bonus, you could still be guilty of an unfair labour practice if you don't pay him. For example, your employee meets all the requirements for payment of a bonus which you've communicated but you refuse to pay or only pay part of it, without a valid reason.
 
If your employee claims this, he'll be able to claim compensation at the CCMA if he can prove that:
 
  • He's entitled to receive this benefit; and
  • You acted unfairly by not paying or not fully paying the bonus.
 
It's that simple.

To protect yourself when it comes to bonuses, always clarify the following in your contracts

 
  • The exact circumstances under which you'll pay the bonus;
 
  • Whether you'll pay the bonus pro rata (a portion of his remuneration);
 
  • Under what circumstances your employee will forfeit his bonus (for example, excessive absenteeism or dismissal for misconduct);
 
  • Bonuses are at your discretion and employees don't have an automatic right to a bonus; and
 
  • Past practice doesn't constitute a right to future bonus payments.
 
PS: For more information on bonuses, check out the Labour Law for Managers Loose Leaf Service and avoid unfair labour practice claims.

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