Bonus - Pro Rata Deductions (claw back) | ExpatWoman.com
 

Bonus - Pro Rata Deductions (claw back)

328
Posts
EW EXPLORER
Latest post on 12 January 2011 - 15:43

Can anyone advise on the following for KSA, Bahrain or UAE?

Can a company pay a bonus for last year (Jan to Dec) in March/April this year and legally have a claw back period of 1 year or 3 years? I.e if a bonus of $12,000 is paid to an employee for a job well done in Jan to Dec 2010, and this is paid in March 2011, then they leave in August 2011, can the company prorata a deduction relating to bonus post paid (e.g 6 month Sept 2011 - Mar 2012)?

I cant find anything in the labour laws for the countries relating to bonus payment deductions. Can anyone advise or advise where I can ask to get the right answer.

Many thanks.

328
Posts
EW EXPLORER
Latest post on 19 January 2011 - 09:37
Thanks wikkis, sorry for the delayed reply! I dont have a copy of the labour contract with TECOM but I know it does not mention bonus in the TECOM contract but does mention discretionary bonus in the company contract. The company contract states "This is discretionary and subject to the Company’s profitability and performance. To benefit from the bonus you must be in the employment of the Company when the bonus’ are announced. If you have left the employment of the Company prior to the bonus announcement you will not be eligible for the bonus." The bonus letter frmo last year stated : "In the unlikely event you should decide to leave the company before 1 March 2011, you will be required to reimburse the company with a pro rata share of this bonus payment and this is to be calculated from the date of your resignation until February 28 2011." This is for the UAE, Bahrain and KSA. As the bonus criteria and eligability is not detailed in the employment contract, I believe it is unfair, unreasonable or breach of contract to decide to hold the bonus for LAST year over our heads to try to stop us from leaving the country. Not everyone is motivated by money and this is a bad retention policy and causes employees to feel trapped and unable to freely leave if they so wish. Thanks for any advice.
298
Posts
EW NEWBIE
Latest post on 13 January 2011 - 14:01
Can you be more specific as to which country and I will try help you, although usually bonus information is contained within the actual contract agreement between the employer and employee, and if you havent found anything in the labour law, its likely because they (the relevant govt) intend for the contract to be the precedent document. Bonuses are hardly ever something that is governed by the country law, but rather individual agreements which differ from situation to situation, for obvious reasons. If you like, you can scan and send me the employment contract (just black out the figures if you want) and I will be able to give you more help. Its also worth finding out whether the company laws / regulations have changed and what the impact is on the contracts signed beforehand. Do you know someone who has joined recently that would give you a copy of their contract to compare?