Are Employers Required to Give Employees Bonuses?


The Supreme Court in Kimberly Clark Philippines, Inc. v. Nora Dimayuga et.al.[1] reiterated the ruling in Businessday Information Systems and Services, Inc. v. NLRC (Businessday):[2]

With regard to the private respondents claim for the mid-year bonus, it is settled doctrine that the grant of a bonus is a prerogative, not an obligation, of the employer. The matter of giving a bonus over and above the workers lawful salaries and allowances is entirely dependent on the financial capability of the employer to give it. The fact that the company’s business was no longer profitable (it was in fact moribund) plus the fact that the private respondents did not work up to the middle of the year (they were discharged in May 1998) were valid reasons for not granting them a mid-year bonus. Requiring the company to pay a mid-year bonus to them also would in effect penalize the company for its generosity to those workers who remained with the company till the end of its days.

This article does not constitute and is not intended to be legal advice. If you have any question or need any assistance on labor matters, please feel free to send us an email at roselle.jean@nonatolaw.com.

[1] G.R. No. 177705, September 18, 2009.

[2] G.R. No. 103575, April 5, 1993.

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