Bonuses

News & Analysis as of

Based on Improper Appointment of Acting General Counsel to NLRB, D.C. Circuit Court of Appeals Voids Unfair Labor Practice Ruling

On August 7, 2015, the United States Court of Appeals for the District of Columbia held that former National Labor Relations Board (NLRB) Acting General Counsel Lafe Solomon's appointment violated the Federal Vacancies Reform...more

End-of-Year Bonuses? Possible Tax Pitfalls!

After stepping down from running the family oil business (see last month’s article), Jed Clampett runs Mama’s Fried Pies, his late wife Rose Ellen’s fried pie business. With business booming, Jed decides to hire Elly May as...more

Should Employers Be Allowed to Count Nondiscretionary Bonuses Toward the FLSA’s Minimum Salary Threshold? The DOL Wants Your...

As we reported last week in “A Call to Action: The Comment Period on the new Proposed Overtime Regulations Begins,” employers have a limited window of opportunity to submit comments in response to the proposed revisions to...more

“White Collar” Exemptions Defined and Delimited

On June 30, the Wage and Hour Division of the U.S. Department of Labor (DOL) issued its much-anticipated Notice of Proposed Rulemaking (NPRM) on “Defining and Delimiting the Exemptions for Executive, Administrative,...more

ERISA Case Highlights Importance of Written Releases at Termination of Employment: Sullivan v. Stanadyne Corporation

A federal court has dismissed claims for enhanced retirement benefits in a case highlighting a participant’s written release of claims at the time of his employment termination. Sullivan v. Stanadyne Corporation, Case No....more

District Court Rejects Lender’s Motion to Dismiss in Ongoing Litigation with CFPB

On June 12, the United States District Court for the Eastern District of California denied Castle & Cooke Mortgage’s motion to dismiss in a putative class action brought by affected borrowers stemming from Castle and Cooke’s...more

Pay to Play? How States Handle Signing Bonuses for Athletes

Non-CPA sports fans (and athletes themselves) increasingly appreciate the tax aspects of luring the best free agent athletes to their teams. One recent example is the whopper of a contract that agent Scott Boras cooked...more

Determining When a Commission is "Earned" When Calculating the Regular Rate

In our last post, we discussed the calculation of the “regular rate” and some of the complexities of determining what constitutes “remuneration” under the Fair Labor Standards Act (FLSA). Commission is one of the additional...more

From Hiring To Firing: A Basic Guide To The Hong Kong Employment Law Life Cycle

Hiring - For many employers, the key to having a productive and high-performing workforce is recruiting the right people to start with. However, it is important for employers to be aware that even before an employee...more

Does Your Wife Deserve A Bonus?

Does a wife deserve a monetary “bonus” for exemplary skills in housekeeping and child rearing? In some social circles, this is actually occurring. In fact, the trend was explored recently in a New York Times Op Ed piece,...more

IRS Limits Correction Opportunities under Section 409A Proposed Income Inclusion Regulations and Imposes 20% Penalty

In Chief Counsel Advice 201518013 (May 1, 2015) (the "CCA"), the IRS addresses an executive retention bonus that originally vested after three years and was payable in equal installments on the first two anniversaries of the...more

IRS Rules Retention Arrangement Violates 409A

In a Chief Counsel Memorandum issued last month, the IRS concluded that an executive retention arrangement violated Section 409A despite the employer’s efforts to correct the arrangement before the retention bonus vested....more

Does Your Retention Bonus Plan Violate IRS Code?

In a memorandum released earlier this month, the IRS Office of Chief Counsel ruled that a retention bonus payable to an executive violated Section 409A of the Internal Revenue Code ("409A"). The IRS further ruled that the...more

Illinois Appellate Court Limits Employer's Discretion To Award Or Deny Bonuses Under Written Bonus Plan

McCleary v. Wells Fargo Securities, LLC, an Illinois Appellate Court held that a former employee stated a claim for an unpaid bonus under a written bonus plan that expressly stated that bonuses were made at the sole...more

Case Alert: Failure to Pay Bonus to Disabled Employee Was Discrimination

What happened? In the recent case of Land Registry v Houghton the Employment Appeal Tribunal (EAT) ruled that an employer had discriminated against disabled employees by operating a bonus scheme which disqualified employees...more

Some Thoughts on Employee Appreciation Day, including a Potential Wage and Hour Pitfall

“And you’re wondering . . . am I appreciated . . . I’m not really appreciated, should I play like I’m appreciated, but I’m not that appreciated . . .but I think my employer might appreciate me . . . but do I want to be...more

SEC "Claws Back" Bonuses and Stock Sale Profits From CFOs of Public Company Charged With Accounting Fraud

On February 10, 2015, the SEC announced settlements with two former chief financial officers of Saba Software, a Silicon Valley software company, that require the CFOs to repay Saba more than $500,000 in bonuses and profits...more

GLOBAL: Lance Armstrong to pay US$10 million to SCA Promotions

On 4 February 2015, an arbitration panel (in a 2-1 decision) ordered Lance Armstrong to pay US$10 million to SCA Promotions (SCA), a sports insurance company, for US$12 million worth of bonuses received for his seven Tour de...more

FMLA FAQ: Is An Employer Required to Pay a Prorated Amount of Annual Bonus after Employee Takes FMLA Leave?

It’s the end of the year. And with the end of the year comes questions from my clients about whether they need to account for an employee’s FMLA leave when doling out year-end bonuses. In other words, is an employer...more

Washington Supreme Court Finds Employer’s Discretionary Bonus Not Unlawful “Rebate” Under Wage Rebate Act (“WRA”)

In a 5-4 decision, the Washington Supreme Court has ruled in an employer’s favor and clarified what are, and are not, statutory “wages” and unlawful wage “rebates” under Washington State’s Wage Rebate Act (“WRA”), RCW 49.52...more

"Banker Bonuses: UK and EU Remain on Collision Course"

Since 1 January 2014, the EU’s Capital Requirements Directive (CRD)1 has required EU-regulated banks (EU Banks) to limit variable compensation paid to key bank staff to 100 percent of their fixed compensation (or 200 percent...more

The EU Bonus Cap and Restrictions on the Use of Role Based Fixed Allowances

On 15 October 2014 the European Banking Authority (“EBA”) issued a report on the use of role-based fixed allowances by various financial institutions within the European Union (“EU”) affected by the EU bonus ratio cap....more

AB 2222 Restricts Use of State Density Bonus Law

On September 27, 2014, Governor Brown signed AB 2222, which amended sections of the State Density Bonus Law (Gov. Code §§ 65915, 65915.5 ["DBL"]). The main purpose of the bill is to require developers to replace all of a...more

Attract and Retain Top Talent When You Cannot Compete Straight Up on Cash

One of the biggest challenges that a business owner may face is attracting and retaining top talent to help drive value and build their company. There are a variety of employee incentive compensation tools that can be used to...more

"EU Debate on Enforcement of the 'Banker Bonus Cap' Approaches End Game"

Michel Barnier, vice president of the European Commission, recently wrote to the chairman of the European Banking Authority (the EBA), asking the EBA to report by the end of this month on whether allowances paid by EU banks...more

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