Bonuses factsheet

Published on: 19/01/2015

Bonus schemes and any benefits are usually categorised as either:

  • Contractual or non-contractual – i.e. right to participate in a bonus scheme
  • Discretionary or non-discretionary – i.e. potential benefit under the scheme.

Contractual bonuses

A bonus scheme will be contractual if:

  • An offer is made to an individual to: participate in a bonus scheme; to receive a certain amount of bonus; or to receive a bonus based on a bonus formula
  • He accepts that offer
  • He acts in reliance on the offer and
  • There is an intention that the bonus scheme will be binding.