It's already the end of March. Have all the wage earners received their year-end bonuses from last year? On March 31, the Tongzhou People's Court, through some cases involving year-end bonuses, sent a message to the hardworking "wage earners": "Your rights and interests are protected by the law."
Thirteenth-month salary ≠ Year-end bonus
Wang joined an engineering company on January 7, 2021, with a monthly salary of 7,000 yuan. On February 2, 2023, Wang left the company. Later, Wang applied for arbitration to the Tongzhou District Labor and Personnel Dispute Arbitration Commission (hereinafter referred to as the Arbitration Commission), demanding that the engineering company pay a total of 14,000 yuan for the thirteenth-month salary in 2021 and 2022. The Arbitration Commission rejected Wang's arbitration request for the thirteenth-month salary. Dissatisfied with the arbitration result, Wang filed a lawsuit in court.
In the recorded phone conversation between Wang and Geng, the legal representative of the engineering company, provided by Wang, Geng clearly acknowledged that Wang's salary was paid in thirteen months. Although the engineering company argued that the thirteenth-month salary was a year-end bonus and the company could independently decide whether to pay it or not, it failed to provide evidence to refute this. In the end, the court ruled that the engineering company should pay Wang a total of 14,000 yuan for the thirteenth-month salary in 2021 and 2022.
The presiding judge said that there is a big difference between the thirteenth-month salary and the year-end bonus. Usually, the thirteenth-month salary, also known as the "double salary at the end of the year," means that the employer pays the employee an additional month's salary in the last month. Generally, the amount and time of the thirteenth-month salary payment are fixed. As a "bonus," the year-end bonus is an additional payment made by the employer to the employee in addition to the regular salary. It is part of the labor remuneration and has an incentive nature. Generally, the employer decides to pay it based on its economic benefits, the assessment of the employee's annual work performance, combined with the company's development plan for the next year, the company's revenue situation, and other factors.
The thirteenth-month salary emphasizes the fairness of incentives. If the thirteenth-month salary is clearly specified in the employer's rules and regulations or the labor contract, it belongs to the employee's basic labor remuneration. At the end of each year, regardless of the employer's business situation or the employee's performance, the employer should pay it. The year-end bonus is linked to quantifiable performance and essentially belongs to the category of "performance salary," that is, the year-end bonus emphasizes the performance assessment results more. It is usually linked to the employee's performance and the company's profitability, has an incentive nature, and the amount is usually not fixed. Whether the year-end bonus is paid or not depends on whether it is clearly specified in the labor contract or the company's system, or whether there is a past practice of payment. If the employer conducts a performance assessment of the employee with appropriate content, a complete process, and transparent results, the assessment results can be used as the basis for whether to pay the year-end performance bonus and the amount of payment.
If the loss cannot be proven, the year-end bonus that should be paid still has to be paid
Zhao joined a company in March 2008 and left the company on December 28, 2023. From May 2017 to December 2023, the company paid Zhao's salary through bank transfer, and Xue, the company's responsible person, transferred the previous year's year-end bonus to Zhao at the beginning of each year. Zhao continuously received the year-end bonus from 2018 to 2021 for four years. In 2023, the company informed Zhao that it would no longer pay the year-end bonus on the grounds that "the payment of the year-end bonus belongs to the company's independent management right, not the company's obligation, and the company is currently facing operational difficulties." After a dispute arose between the two parties, Zhao filed for arbitration, demanding that the company pay a year-end bonus of 40,000 yuan from January 1, 2022, to December 28, 2023. The Arbitration Commission did not support Zhao's claim for the year-end bonus. Later, both parties were dissatisfied with the arbitration award and sued in court.
As the employer with management responsibilities, the company should bear the burden of proof regarding the specific payment conditions, payment standards, and calculation method of the year-end bonus. Although the company claimed that it did not need to pay the year-end bonus due to operational difficulties, it did not submit any evidence of the claimed operational losses and should bear the legal consequence of failing to provide evidence. Zhao engaged in waterproof work in the company, was managed by the company in terms of labor and received a salary from the company, which can prove that there was a labor relationship between the two parties. Zhao met the conditions for receiving the year-end bonus. Considering that the year-end bonus paid by the company to Zhao had the characteristics of periodicity and consideration, in the end, the court ordered the company to pay Zhao the year-end bonus for 2022 and 2023 with reference to the amount and standard of the previous year-end bonuses.
Leaving the company before the year-end bonus is paid, not entitled to the year-end bonus?
Peng joined an information technology company in April 2020 as the general manager, with a monthly salary of 40,000 yuan. On March 11, 2021, the information technology company issued a notice of termination of the labor contract to Peng on the grounds that Peng was suspected of absenteeism and providing false reimbursement vouchers, which seriously violated the company's rules and regulations. The labor contract between the two parties was terminated on the same day.
Later, Peng applied for arbitration, demanding that the information technology company pay the year-end bonus from April 2020 to December 31, 2020, etc. The Arbitration Commission ruled that the information technology company should pay Peng a year-end bonus of more than 21,000 yuan from April 1, 2020, to December 31, 2020. Later, the information technology company was dissatisfied with the arbitration award and sued in court.
Although the "Performance Responsibility Letter" signed between Peng and the information technology company states that if an employee leaves the company or is dismissed before the bonus is paid, the year-end bonus will not be paid. However, the information technology company and Peng terminated the labor contract on March 11, 2021, and the year-end bonus was calculated based on the work performance in 2020. After examination, Peng's work performance and work performance in 2020 had reached the conditions for the payment of the year-end bonus specified in the "Performance Responsibility Letter." In addition, the information technology company did not provide valid evidence to prove that Peng had seriously violated the company's rules and regulations, such as absenteeism and providing false reimbursement vouchers. It had no factual or legal basis for terminating the labor contract with Peng on this ground. In conclusion, it was unfair for the information technology company to refuse to pay the year-end bonus on the grounds that Peng was dismissed before the year-end bonus was paid. In the end, the court ruled that the information technology company should calculate and pay Peng a year-end bonus of more than 21,000 yuan according to Peng's length of service in 2020.
The judge said that for employees who have left the company before the year-end bonus is paid, whether they can receive the year-end bonus cannot be simply determined by provisions such as "employees who leave the company before the year-end bonus is paid are not entitled to the year-end bonus" in the rules and regulations to deprive employees of their right to receive the year-end bonus. Instead, it should be comprehensively considered in combination with many factors, such as the employee's length of service, the reason for leaving the company, work performance, and the degree of contribution to the unit.