Bonuses are often a significant part of compensation, but when employment ends, many employees are told they are “not entitled” to them.
That’s not always true.
Whether you receive your bonus after termination or resignation depends on your employment contract, bonus plan, and how Ontario courts interpret those terms.
If your employer has withheld a bonus, you may still have a legal claim.
Bonus denied after termination?
You may still be entitled to that money
Employers often rely on contract language to deny bonuses, but courts frequently reject unfair or unclear terms. Before accepting a loss, have your bonus reviewed.
Call 1-800-771-7882
When Are You Entitled to a Bonus After Termination?
In Ontario, entitlement to a bonus depends on:
- Your employment contract
- The wording of the bonus plan
- Whether the bonus is discretionary or earned
- Your employment status at the payout date
- Court interpretation of fairness
Even if your contract says you must be “actively employed,” that clause may not always be enforceable.
Do You Get Your Bonus If You’re Terminated Without Cause?
Often, yes, but it depends.
If your bonus is:
- A regular part of compensation
- Based on past performance
- Already earned or accrued
You may still be entitled to it as part of your severance package.
Courts frequently include bonuses in common law notice damages, especially when they are predictable and recurring.
Do You Get Your Bonus If You Resign?
This is more complicated.
In many cases:
- If the bonus is already earned → you may still be entitled
- If the bonus depends on future conditions → you may not be
However, if your resignation is actually constructive dismissal, the analysis changes.
Common Situations Where Bonuses Are Disputed
You may have a claim if:
- Your employer says you must be “actively employed” on payout date
- You were terminated just before the bonus payout
- Your bonus was reduced or withheld unexpectedly
- You resigned after being pressured or pushed out
- Your employer calls the bonus “discretionary” but pays it consistently
These are some of the most litigated issues in employment law.
Can Your Employer Refuse to Pay a Bonus?
Only if the contract clearly allows it, and even then, courts may step in.
Ontario courts often reject bonus clauses that are:
- Unclear or ambiguous
- Unfair or misleading
- Inconsistent with past practice
Employers cannot rely on technical wording alone if it leads to an unfair result.
What About Deferred or Long-Term Bonuses?
Deferred bonuses (e.g., stock, retention bonuses, LTIPs) are often disputed.
Key questions include:
- Was the bonus already earned?
- Did termination prevent it from vesting?
- Does the plan clearly remove entitlement?
These cases can involve significant compensation and are worth reviewing carefully.
What Should You Do If Your Bonus Was Not Paid?
1. Review Your Contract
Look at bonus clauses, conditions, and definitions.
2. Gather Evidence
Past bonuses, emails, compensation structure.
3. Do Not Accept the First Offer
Many employees leave money on the table.
4. Speak With an Employment Lawyer
A review can quickly determine whether you have a claim.
FAQs About Bonuses After Termination
Possibly. If the bonus is part of your compensation or was earned during your employment, it may be included in your severance.
Sometimes. If the bonus was already earned, you may still be entitled, especially if your resignation could be considered constructive dismissal.
Not always, but if the bonus is tied to past performance or earned work, they may still owe it.
Only if your contract clearly allows it. Even then, courts may reject unfair reductions.
It depends on whether the bonus was earned or conditional. Many disputes arise from this exact situation.
Even discretionary bonuses can become enforceable if they are paid regularly and form part of your compensation.
You may have a legal claim. Bonus disputes are often resolved through negotiation or legal action.
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Bonus denied after termination?
You may still be entitled to that money
Employers often rely on contract language to deny bonuses, but courts frequently reject unfair or unclear terms. Before accepting a loss, have your bonus reviewed.
Call 1-800-771-7882
The article in this client update provides general information and should not be relied on as legal advice or opinion. This publication is copyrighted by Achkar Law Professional Corporation and may not be photocopied or reproduced in any form, in whole or in part, without the express permission of Achkar Law Professional Corporation. ©
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