Bonus entitledment

A “bonus” is an extra payment on top of what you are already entitled to. But how does this work legally in employment? When do you actually have a right to your bonus?

Discretionary

Whether you receive a bonus often depends on meeting predefined targets. If you don’t meet them, you generally have no right to a bonus. Many bonus schemes also include a general clause stating that the final awarding of the bonus is subject to management approval. Such a clause is scrutinized carefully by courts. If it is customary within the organization to grant bonuses, and you have received your bonus consistently over the years, the bonus can become part of your salary, and your employer cannot simply decide to withhold it.

Suspension (Non-active status)

If you have not worked for a reason attributable to your employer, your employer must still pay your salary. This generally also applies if you have been placed on suspension (non-active status). In that case, it must be assessed whether you would have received the bonus if you had not been suspended. If the bonus depends on company results, this is relatively straightforward. If it depends on your individual performance, an estimation must be made whether you would have met the targets.

Sickness

The statutory right to continued payment during illness is limited to 70% of the maximum daily wage. However, employment contracts often stipulate full salary continuation — or this is customary — and in those cases, the bonus is also due. It must then be determined what bonus you would normally have received during the period you were absent due to illness.

Vacation

Bonuses must be paid during vacation.

Pregnancy

If you are pregnant, you are not entitled to your salary but to a benefit under the Sickness Benefits Act equal to your salary (capped at the maximum daily wage). Bonuses are often calculated over an entire year, and the Arnhem Court ruled that it was acceptable for the employer to reduce the bonus pro rata to the absence during maternity leave. Some argue this conflicts with European anti-discrimination laws, but the European Court of Justice has not yet specifically ruled on this issue.