Should Employees Keep Their Bonus if They Resign Right After Receiving It?

Hi,

I am working in a software firm with around 30 people. Deserving employees are given a bonus on a quarterly basis every year. One employee received his quarterly bonus at the end of Q1. At the beginning of Q2, he submitted his resignation and left the company after serving his notice period.

@Saswata - As I have mentioned, the employee has submitted his resignation during the beginning of Q2, served his notice period, and left the company. So, along with his salary, is the company obliged to pay him the quarterly bonus?

@Nathrao - That is my query. I feel that if an employee has their salary processed during the notice period, then their bonus should also be processed. However, my manager has the opposite view. His perspective is that once an employee submits their resignation, perks like bonuses, incentives, etc., will lapse for the notice period served. Therefore, if an employee who is eligible for a quarterly bonus resigns during a quarter, they will receive a pro-rated bonus. For example, if they resign in the 2nd month, they will only receive the bonus for the 1st month of that quarter, while the bonus for the 2nd and 3rd months will be forfeited. If they resign in the 1st month, they will not be eligible for a bonus for that quarter. Please let me know what the actual practice followed is.

Quarterly Bonus and Employee Resignation

Quarterly bonuses are not aligned with the standard payment of bonuses. Therefore, I assume that the company is providing bonuses on its own as an incentive. In that case, it is the company's discretion as to which person will receive the bonus and how much they will get. Since it is an incentive, it does not make sense for the company to pay it to someone who has submitted their resignation and will be leaving. In fact, I would not even consider a bonus for the month during which they worked in the company in the normal course, because there is no point in giving an incentive to someone who is not going to continue working with us.

The answer would be different, of course, if the concept of a quarterly bonus was already provided in the appointment letter or any other HR documents given to the employee.

Incidentally, it would have been a good idea if you had included the details right in the first post instead of waiting for someone to ask what your actual problem is…