Employers wishing to withhold a bonus from an employee who has left or is under notice on the bonus payment date should expressly provide this in the scheme rules.
A recent case has highlighted that it will be difficult to argue that such a term could be implied without evidence of a clear unvarying practice, at the time of entering into the contract, of not paying bonuses in this situation.
Even with such an express clause, it may still be possible to argue that an employer is subject to an implied term not to dismiss simply to avoid a bonus payment. This argument was held to have a real prospect of success at a preliminary hearing in Takacs v Barclays in 2006, but the case subsequently settled. The argument is perhaps given some support by the court's view in this case that a term which would enable an employer to dismiss an employee the day before the bonus payment date solely to avoid paying the bonus is manifestly unreasonable and gives rise to a clear injustice. (Rutherford v Seymour Pierce Ltd, HC)