Is This Allowed?

Rex_Mundi

My OH works in an office hiring out meeting rooms for conferences and parties etc. A few months ago, she received a letter from the general manager stating that she would receive a percentage bonus on any amount over her monthly target figures. Last month, the office did extremely well, and sold well over the target figure. Her bonus worked out at £900+ to be paid this month. She has just received this months wage slip, and the bonus paid is only £250. When she questioned her office manager about the amount, she was told that nobody is getting a bonus this month (not even the managers).

Is her company allowed to do this? She has a written letter stating that 10% of revenue over the target figure is to be split between her and one other worker in the office doing the same job. The letter also states the monthly targets.

The amount paid bears no relevence to the figures that were achieved last month (only about 2.5%/3%). The company seems to have reduced the bonus amount with no warning, and for no apparent reason. My OH is fuming about this, and is wondering whether they are allowed to do this.

intel

Hi Rex

This seems wrong to me at first glance, but was there anything in writing to help
secure her position as to regards of bonus.

Nile

Hello Rex_Mundi


I would smell a rat on this one. If I were in her shoes, I'd ask the manager at the next level up to explain the bonus...........but not prompt him or her with what has already been said...........to see if the same reason is given.

Many years ago I was entitled to a bonus and my line manager told me that there weren't any bonuses that year. I later found out that he'd given my bonus to his favourite blue eyed boy.:mad:

Rex_Mundi

Thanks for the replies so far. I have in front of me the letter offering the bonus and stating what each months targets are. This is signed by the general manager.

Last month, figures were shown each day as to how well they were doing. At the end of last month. The office manager showed the figures for the month, and said that they were due over £900 each bonus. This is the same manager that couldn't explain the low bonus figure today, and said that nobody was getting a bonus (herself included). This specific bonus was only offered to my OH and one other member of staff. It was relevent only on their sales figures, not any other part of the business as a whole. This is all in writing from the general manager when he made the offer.

As you can well appreciate, My OH is livid. She feels she has been conned out of money, and has no idea what to do about this, or what her rights are.

Does anyone know what the legalities of bonus payments are?

intel

Well if you have a letter stating that,, isnt that regarded as any other contract as binding, or a binding extension of the original contract conditions...


CAB office to me.....

Savvy_Sue

Or ACAS. Might be easier to get advice from their website than to contact local CAB at this time of year.

ioscorpio

Have a look at her contract of employment, a previous job I had stated what my salary was and a bonus/commission scheme was in place but could be changed at any time. As savvy_sue has said you should also take legal advice from ACAS or a local law centre as they specialise in employment law.

Rex_Mundi

iomexico wrote:

Have a look at her contract of employment, a previous job I had stated what my salary was and a bonus/commission scheme was in place but could be changed at any time. As savvy_sue has said you should also take legal advice from ACAS or a local law centre as they specialise in employment law.

Cheers.

She has worked for the company for about 8 years now, and her wages are normally a straight salary. This offer of the bonus was only made this year.

She is not back for another 1½ weeks yet. We'll wait till everything starts to get back after the holidays, and contact ACAS by phone for further advice (late this week or next week sometime).

WHA

Is the bonus related to revenue "earned" or "received" - there is a massive difference that sales departments never seem to understand. What are the terms of the bonus - is it paid in the month the sales are achieved, or the month after?

It is quite possible to have a "bumper" month of "sales" but not actually have any "cash" - i.e. if customers pay on a month or two credit. In this case, it is quite possible that the company doesn't have any money to pay the bonuses this month but will do next month when the customers pay.

Alternatively, the bonus paid in December may have related to November's sales and the December sales bonus will be paid in January. This is because the wages for December will have been prepared probably a week or two before the end of the month and at that time, the sales for December wouldn't have been known.

Of course, all this is speculation, but these are the type of issues that cause this apparent discrepancy. However, her manager should know all this and know the reasons - it sounds as if the manager is a bit clueless to be honest if they can't field this sort of query properly!

Rex_Mundi

The deal stated that the bonus for each month would be paid the following month after the figures were submitted to HQ (which was done early Decmember). The bonus was to be based on room hire sales above target (not based on when the bill is settled by the customer).

Last month (November), the figures were collated daily by the office manager. Each day she showed how well they were doing. It was the office manager that showed the figures at the end of the month and told my OH and co-worker that they were due £900+ each bonus this month. The bonus was on nett revenue over the target figures. The figures shown each day (and at the end of the month) were already adjusted to show the nett income after costs.

Obviously, after being shown the figures, and being told what the bonus was in the region of. It was a shock when my OH only found the bonus was £250. This figure bears no relation to any info that was given in November.

Can the company change the rules without notice? It may be that other sections of the company never performed as well, and they are looking to cut costs where possible. This would seem wrong, seeing as the bonus is unrelated to other sections of the company (it's a very big multinational company).