Recovered over RUB 5.7 million of unpaid bonus and compensation from the employer

This was not an ordinary dispute over a fixed salary.

The amount of the bonus directly depended on the employer’s financial result.

Therefore, it was necessary to prove several circumstances at once:

• the validity of the supplementary agreement;
• the binding nature of the condition to pay 10% of net profit;
• the amount of the company’s net profit for the relevant periods;
• the amount of payments already made by the employer;
• the balance of the debt;
• the employee’s right to the bonus for the period before dismissal;
• the absence of a missed deadline for going to court;
• the amount of compensation for the multi-year delay in payment.

The employer tried to dispute the grounds for paying the disputed amount.

But the bonus condition was directly recorded in the supplementary agreement to the employment contract:

“The Employee is paid an annual bonus of 10 percent of the Employer’s net profit based on the financial year results”.

The court recognized the fact of concluding this agreement as proven.

This was of fundamental importance.

The company could not, after the dispute arose, arbitrarily interpret the remuneration condition agreed by the parties as a non-mandatory payment entirely dependent on the employer’s discretion.

Data on the actual net profit of Sintezkomplekt LLC was used for the calculation.

The court examined:

• the employer’s accounting statements;
• information from the tax authority;
• the company’s own documents;
• data on the amounts previously paid to the client.

The company’s net profit for one of the disputed financial periods was RUB 36,926,000.

For another period, the amount of profit was determined taking into account the time actually worked by the client before dismissal.

The court established the total amount of the bonus due — RUB 4,922,300.

From this amount, the RUB 1,503,562.86 previously actually paid to the client was deducted.

The balance of the employer’s debt was:

RUB 3,418,737.14.

The defendant objected to the satisfaction of the claims.

In particular, the following were disputed during the case:

• the basis for paying the bonus;
• the procedure for its calculation;
• the possibility of recovering the payment for a year the employee did not work in full;
• the deadline for the employee to go to court;
• the need for the court itself to withhold personal income tax;
• the very legal nature of the disputed payment.

These arguments did not allow the employer to avoid liability.

The defendant asked to apply the consequences of missing the deadline for going to court.

However, the specific deadline for paying the annual bonus was not set by the supplementary agreement.

The court proceeded from the fact that, until dismissal, the employee had reasonable expectations of receiving the bonus provided by the agreement.

The employer had to make the final settlement upon dismissal.

The court concluded that the deadline provided by labor law for claiming the unpaid wages was observed by the client.

The employer also referred to the fact that the client had not worked a full calendar year and therefore was not entitled to the bonus for that period.

The court rejected this argument.

The supplementary agreement did not provide that the right to the bonus is completely lost upon dismissal before the end of the financial year.

Therefore, the amount of the payment was calculated in proportion to the time actually worked.

The dispute was not limited to the unpaid bonus.

Under Article 236 of the Labor Code, the employer is obliged to compensate the employee for the delay in payments due to him.

As of the court decision date, the amount of such compensation was:

RUB 2,329,185.63.

Moreover, the accrual did not stop there.

The court additionally recovered compensation for each day of further delay until the actual settlement, based on 1/150 of the current key rate of the Bank of Russia on the unpaid amount of RUB 3,418,737.14.

That is, the continuation of the delay in settlement increased the employer’s obligation daily.

The case is illustrative for several reasons.

First, the large bonus was set not as a fixed amount, but as 10% of the employer’s net profit.

Second, after dismissal, the employer tried to dispute the very right of the former employee to a significant part of the remuneration.

Third, in addition to the principal debt, a very substantial compensation for the delay was recovered — over RUB 2.3 million already as of the decision date.

And finally, the dispute ended not only with a court ruling.

The client received the money in full.

The case was handled by Konsultant Law Firm.

The client’s interests directly in the court hearing were represented by V.A. Erofeev, a lawyer of Konsultant Law Firm.

The legal work included forming the position on the labor dispute, clarifying the claims, calculating the debt and the compensation for the delay in payment, working with financial evidence and defending the client’s position in court.