Welcome to this month's briefing for HR teams and in-house employment counsel – bringing you this month’s employment law highlights in an easy-to-read package.
Bonus schemes
Bonus schemes usually fall into two main categories: genuinely discretionary schemes, where the only controls on the employer are that bonus allocations must not be perverse, arbitrary or capricious; and formulaic or fixed schemes, where amounts are predetermined or derived from a known metric such as profit or EBITDA. In an unusual recent case, the Tribunal had to decide whether a one-off sales bonus announced at a company town hall could be changed to introduce a cap on the cash amount and a senior authorisation requirement. Neither of those elements were communicated during the town hall, and the individual who had secured the relevant deal was, the Tribunal decided, therefore entitled to an uncapped amount. The decision is a useful reminder of the need to document bonus schemes carefully, and ensure all the