Caven blog

Workers at car-plant upset at ‘scrooge-like’ Christmas bonus

The Daily Mail reported on Saturday that employees of Luxembourg-owned International Automotive Components (IAC), which fits the trim to the Jaguar Land Rover, were bemoaning the state of the Christmas bonus at their place of employment.

Their bonus consists of a buffet with a choice of bacon or sausage sandwiches.

Employees at the plant do not receive any Christmas cash bonus (also known as the 13th pay check) or even a Christmas party, according to the Mail. This state of affairs persists despite the company posting profits last year of £1.9 billion for its European operation.

A staff member, who did not wish to be named, said: “I feel like telling them where to stuff it. We slave all year, they are making a fortune and this is all they can manage?”

A spokesperson for the company said that the buffet was an annual tradition at the plant, adding: “There’s no obligation to give a cash bonus in December.”

In contrast, the Mail points out that publisher Random House (now merged with the Penguin Group) announced last week it was giving all employees, even warehouse workers, a $5,000 Christmas bonus, because of the huge success of the erotic novel ‘Fifty Shades of Grey’, by E.L. James. The book, published in 2011, has sold approximately 60 million copies worldwide so far.

While it is true that it is not compulsory for an employer to hand out Christmas bonuses, where this practice exists in the UK there are legal ramifications; much may depend on the terms of the employment contract and the usual ‘custom and practice’ of the company.

An employment contract is a legal document that should state exactly the conditions under which a bonus may be granted, and exceptions to the policy should be set out clearly.

However, this means that an employer may have little leeway with regard to withholding a bonus; for example, they may have to pay the 13th pay check if all contractual criteria have been fulfilled, even if an employee is working out their notice on the given bonus payment date.

In other cases Christmas bonuses may be discretionary, and while there are no legal conditions in Employment Law which determine or regulate their payment, past decisions of the courts mean that an employer cannot act entirely arbitrarily when deciding on the matter.

For example, regular payment of a discretionary Christmas bonus in particular circumstances may give rise to an implied contractual right of the employee with regard to the extra payment, in addition their wages and overtime pay.

Thus, an employer might face a common-law challenge if they have habitually paid a Christmas bonus to employees, and then it is withdrawn without fair notice; for example, of three months or more.

Furthermore, it could create a problem if any employer pays a Christmas bonus to some colleagues and not others and the criteria they use to do so could be challenged in the courts; for example, if female employees get substantially less bonus than their male counterparts, an employer may be open to a charge of sex discrimination under the Equality Act 2010.

As it appears the car workers at IAC have never received a Christmas cash bonus, their only course of action may be to attempt a re-negotiation with their bosses over the matter. In their favour, they might argue that the paying of a Christmas bonus could enhance workers’ loyalty and commitment to the company.

However, in the current economic climate the car workers might be in for a long argument. They will probably need those fortifying sandwiches.

Original story:

The Daily Mail | 2

3 comments on “Workers at car-plant upset at ‘scrooge-like’ Christmas bonus

    • I agree, it’s nice to see a company reward everyone that contributed to their success. This kind of generosity will be greatly appreciated by staff and will promote a positive work environment.

Leave a Reply

Your email address will not be published. Required fields are marked *

*

Please click to prove you are human and not spam.

HTML tags are not allowed.

Quick enquiry form
Area of law:
Name:
Town/City:
Email:
Phone: