Resigned employee wins £2,000 conditional bonus after employer refused payment

What this case shows in practice

This case highlights the importance of clear contractual terms when offering conditional bonuses to employees, especially those who have resigned. The management information analyst had given notice and was about to leave when his employer, Direct Commercial Limited, offered a £2,000 bonus subject to three targets. He signed the agreement, completed the tasks, and provided a handover, but the employer later refused to pay, claiming the conditions were not met.

The tribunal found that the employee had indeed met all three conditions. The employer argued that the conditions were 'entire' – meaning all must be fully satisfied for any payment – but the tribunal disagreed, noting the letter did not state that the conditions were indivisible. This meant the employee was entitled to the full bonus.

What the losing side could have done differently

Direct Commercial Limited could have avoided this outcome by clearly stating in the bonus letter whether the conditions were entire or divisible. If they intended an all-or-nothing approach, they should have said so explicitly. Additionally, they should have carefully assessed the employee's performance against each condition before refusing payment. The tribunal noted that the employer's decision was not reasonable given the evidence.

Why the result matters for similar claims

This decision reinforces that bonuses offered during notice periods are enforceable contracts. Employees who meet the stated conditions are entitled to payment, even after resignation. Employers cannot rely on vague or implied terms to deny bonuses. The ruling also clarifies that bonus conditions are presumed divisible unless clearly stated otherwise, meaning employers may have to pay for partially met conditions. For employees, this case shows the value of keeping records and pursuing a breach of contract claim if a bonus is unfairly withheld.