Sign-on bonus payback in the event of redundancy

inquisitivewanderer

Hi,

I received a large sign-on bonus when I joined my current employer earlier this year.
In the first 8 weeks they started making a small number of redundancies (not in my area), and although I've been told those in my area are 'as safe as houses', I am obviously concerned about what is around the corner. I have two small children & also have my MIL live with us. I am also the breadwinner in the house and losing my job would be a very worrying situation indeed.

I have enough savings to keep us going for at least 6 months if this does happen so I'm not overly concerned on that front. However, there is a clause in my contract that states:

Should the Company or you serve a notice of termination within the first year of your employment you must pay the Company the full amount of the sign on bonus within 30 days from the date the notice of termination is served. The Company has the right to set off any amount outstanding from the bonus against any salary due. The Company reserves the right to vary or remove any discretionary bonus scheme it shall provide. 
 
My question is, does redundancy come under the banding of 'being served notice' by the company, and therefore would I be forced to pay back this bonus if redundancy were applied to me in the remainder of the first year of my employment with the business?

TIA

MattMattMattUK

inquisitivewanderer said:

Hi,

I received a large sign-on bonus when I joined my current employer earlier this year.
In the first 8 weeks they started making a small number of redundancies (not in my area), and although I've been told those in my area are 'as safe as houses', I am obviously concerned about what is around the corner. I have two small children & also have my MIL live with us. I am also the breadwinner in the house and losing my job would be a very worrying situation indeed.

I have enough savings to keep us going for at least 6 months if this does happen so I'm not overly concerned on that front. However, there is a clause in my contract that states:

Should the Company or you serve a notice of termination within the first year of your employment you must pay the Company the full amount of the sign on bonus within 30 days from the date the notice of termination is served. The Company has the right to set off any amount outstanding from the bonus against any salary due. The Company reserves the right to vary or remove any discretionary bonus scheme it shall provide. 
 
My question is, does redundancy come under the banding of 'being served notice' by the company, and therefore would I be forced to pay back this bonus if redundancy were applied to me in the remainder of the first year of my employment with the business?

TIA

In answer to the first question yes, in answer to the second, no one knows, just because they are contractually able to recover the signing on bonus does not mean that they would, but they do have the right to. 

Grumpy_chap

inquisitivewanderer said:

Hi,

I received a large sign-on bonus when I joined my current employer earlier this year.
In the first 8 weeks they started making a small number of redundancies (not in my area), and although I've been told those in my area are 'as safe as houses',

One might reasonably expect that the company operate with a reasonable level of competence and had enough knowledge of the business performance and future plans to be able to see 2-months (8-weeks) ahead when the made you the offer with the sign-on bonus.

It is quite possible that the recruitment into your role was required to be complete ahead of the redundancies elsewhere because the business knew those that were likely to be made redundant were not individuals that they wanted in your role.  Easier to enforce if there simply are not current vacancies.