Executives in Colorado may anticipate receiving their annual bonus or commissions this time of year in recognition of a job well done. It is important to note that bonuses and commissions are considered part of an employee’s wages or compensation for work performed. That being said, the good times do not always last forever, and a person may find themselves in a situation where they are being let go. What happens to your bonus or commissions if you are fired?
Bonuses upon separation from employment
Under Colorado law, if a worker is fired, any wages or compensation earned and unpaid at the time of discharge is due immediately. Compensation not yet fully earned need not be paid, and this includes bonuses. However, bonuses earned per the terms of a written or oral agreement are considered compensation and must be paid when earned, vested and determinable.
What about commissions?
Some workers, rather than receiving a bonus receive commissions based on work performed in addition to their wages. These commissions, like bonuses are considered income. And, like bonuses if these commissions are earned, vested and determinable when the worker is let go must be paid.
Seek help if you are wrongfully denied a bonus or commission
If you have been let go from your job, and believe you were wrongfully denied a bonus or commission earned, you may have rights. This post does not contain legal advice applicable to any specific case. Employment law attorneys can provide advice on this topic so workers can make informed decisions that are in their best interests.