The year is winding down and the festive season is fast approaching. One of the eagerly-awaited rewards for a year of work by workers are bonuses.
But what kind of worker is entitled to a 13th cheque or a bonus? And are companies and businesses mandated to give out such?
The Consolidated Employers Organisation emphasised that 13th cheques and bonuses are not to be used interchangeably.
“A 13th cheque is a bonus that the employee can expect every year if this forms part of their employment contract. A bonus, on the other hand is a reward based on the employee’s performance and the performance of the business,” said the organisation.
According to Labour Guide, it is critical to recognise that there is no legislative duty under labour law to give any kind of bonus.
Labour Guide added that in some cases, the payment of a bonus and its amount may be contingent on or related to the employee’s hours of work, performance, or productivity in their place of work.
“Another factor deciding the payment or non-payment might be the employee’s score in a performance appraisal test,” said the institution.
“It follows, therefore, that the payment of such bonuses is seldom guaranteed, and employees would be foolish to rely on the payment of these discretionary bonuses simply because the bonus was paid last year or other previous years.”
What happens when employers want to change their position in bonus payments?
This could be by paying less, paying at a different time of year, splitting what was an annual bonus into two separate payments, or discontinuing such payments entirely.
According to labour law, such employers must consult with employees, explain the issues, and try to persuade them to accept the new system.