Labour & Service Law

Can a private company refuse to pay a departing employee their pending bonus?

Asked by Anonymous · Answered 22 Jan 2026

The Question
I left my job before the annual bonus was disbursed, and my former employer says I'm not entitled to it since I wasn't employed on the payout date. Is this correct?
Answer — MyLawIndia Legal Team

This largely depends on the specific terms of your bonus policy or employment contract — many company bonus schemes do specify that an employee needs to be actively employed on the disbursement date to be eligible, and if your contract or policy clearly states this, the employer's position may well be legally correct.

That said, if the bonus you're referring to is a statutory bonus you're legally entitled to under bonus payment law (applicable to eligible categories of employees based on salary and other criteria), rather than simply a discretionary company bonus, different rules may apply, and you could have a stronger claim to at least the pro-rata statutory portion for the period you actually worked.

It would help to carefully review your specific bonus policy or contract wording, and clarify whether the bonus in question is a statutory entitlement or a purely discretionary company scheme, before deciding whether to pursue this further with a labour lawyer's guidance.

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