In person For the v Respondent — 2020

Mrs Donna Jonas brought a monetary breach of contract claim against Openreach Limited arising from the calculation of her 2018/2019 bonus under the respondent's discretionary Reward Framework. The tribunal recorded that the claimant had worked as a Finance Analyst from 29 June 1981 until 30 June 2019, that her employment ended following a reorganisation, and that she accepted an Enhanced Voluntary Leavers Package worth in excess of £86,000. The dispute concerned the third-stage personal performance multiplier applied to her bonus: the claimant said it should have been 0.8, while the respondent applied 0.5, a difference agreed to be £1,800 gross.

The tribunal found that the bonus scheme was discretionary and that the respondent had a limited pot of money to distribute. It accepted the respondent's explanation that the lower multiplier was chosen because of the reorganisation, the need to reward and motivate employees who remained with Openreach on reduced salaries, and the fact that the claimant had already received a generous EVLP. The tribunal also noted that many employees who left in March 2019 were not eligible for the bonus, whereas the claimant remained employed until 30 June 2019 and was therefore eligible for consideration.

Applying the implied contractual term that discretion must not be exercised arbitrarily or capriciously, and asking whether the decision was one no reasonable employer might have made, the tribunal held that the decision to use a 0.5 multiplier was within the agreed parameters of the scheme and was neither arbitrary nor unreasonable. It also noted that the decision had been reviewed by a second line manager. The breach of contract claim was therefore dismissed.