New York Banker Bonus Disputes
Many New York bankers work hard all year for their bonuses. But some of those bankers don't get what they were expecting, and some get nothing. I recently met with a banker who was fired after working all year and the bank will not pay the bonus. Not fair for the banker, but is it illegal?
The law that applies to banker bonuses is pretty simple. It applies to non-bankers as well. The root of the issue goes to whether or not the parties agreed, expressly or implicitly, that the bonus would be paid. If the circumstances indicate that the banker and the bank both knew that the bonus would be paid at year end, then the banker may have the right to recover that bonus. In order to evaluate these claims, the following factors are typically considered:
- was the bonus a substantial part of the banker's total annual compensation?
- is there a pattern of paying the banker such a bonus?
- did the banker do anything that would justify non-payment of the bonus?
- did anything happen at the bank (like poor earnings) to justify non-payment?
These banker bonus disputes are handled by FINRA through arbitration. Typically a panel of arbitrators handles these matters and FINRA has a good record of treating bankers and banks fairly. If you have a question about a bonus dispute, please give us a call.
