Sponsored by:Do you have to pay a bonus following the termination of employment?‘Discretionary’ bonus can be unwelcome surprise in litigationBy Shana French and Brian Wasyliw02/21/2017|Canadian HR Reporter|Last Updated: 02/21/2017 This is the time of year when many companies determine bonus payments for the preceding year and set targets or review language for the upcoming year. A bonus is commonly intended as a performance tool to reward and incentivize an employee who has or is expected to contribute to the success of the organization and/or achieve performance objectives.As a tool to reward and motivate, an employer may seek to tie bonus entitlement to active employment status. Unfortunately, in many cases, employers have been unsuccessful in precluding a bonus claim from a former employee. Whether the exposure is in respect of a pro-rata claim by an employee who has left before the end of the relevant bonus period, or a claim for lost bonus opportunity during the period of applicable notice, many employers are surprised to discover there is serious risk of a significant payment to a former employee in respect of these bonus claims. A common mistake an employer may make is failing to have a written bonus plan at all, or using an outdated or “dusty” written plan or policy an employee may, or may not, have seen. To Read the Full Story, Subscribe or Sign In Remember Me Forgot Password If you are a current Subscriber, please click here to set-up or update your login information.