Home Q&A Forum Can a company withhold a performance bonus if I leave before the payout date?

Employment

Employment Contract

Georgia

Asked on Apr 12, 2025

Can a company withhold a performance bonus if I leave before the payout date?

I recently resigned from my job, and in my employment contract, there was a provision for a performance bonus to be paid out at the end of the year. However, the payout date is a few months away, and I am concerned that the company may try to withhold the bonus since I am no longer employed with them. I want to know if they have the legal right to do so, or if I am still entitled to receive the bonus based on my performance during my time of employment.

Answers from 1 Lawyer

Answer

Employment

Georgia

Answered 376 days ago

Jerome L.

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June 25, 2024

This is a great—and very common—question. Whether the company can legally withhold your performance bonus after resignation depends heavily on how your employment agreement is written and how the bonus is classified. Key Factors to Consider: 1. Is the Bonus Discretionary or Earned? If your contract defines the bonus as discretionary, the employer generally has the right to decide whether to pay it and can condition it on continued employment. If the bonus is based on meeting specific performance goals or metrics, and those have been satisfied, it may be considered earned—even if the payment date is in the future. 2. Does the Contract Require You to Be Employed on the Payout Date? Many agreements include language stating the employee must be actively employed on the bonus payout date. If such a clause exists, the company may be within its rights to withhold the bonus, even if the performance was completed. 3. What Is the Bonus Period? If your bonus was based on a performance period that has already ended (such as a calendar or fiscal year), and you met your goals, you may have a stronger case for claiming the bonus as earned compensation. Georgia-Specific Note: In Georgia, employment is at-will, and courts generally uphold the terms of a written employment agreement. However, Georgia courts have also recognized that earned wages (which can include bonuses if not discretionary) must be paid. If the bonus is performance-based and the company has paid similar bonuses under the same conditions in the past, you may have grounds to assert that the payment is owed. What You Can Do: Review your employment agreement and any bonus policy documents closely. Look for phrases like “discretionary,” “earned,” and “must be employed on the payout date.” If the language is unclear, you may want to consult an attorney to evaluate whether the company is legally permitted to withhold the bonus—or if you may have a claim based on how the bonus was structured and earned. If you would like help reviewing your agreement, I’d be happy to assist.

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