Mr I Butt v Simpson Millar LLP — 2021

Mr Butt worked for Simpson Millar LLP as a finance business partner from 15 April 2019 until 30 September 2021. He claimed that the respondent had failed to pay two instalments of his 2020 bonus, each said to be £1,833.33, and the tribunal treated the case as a claim for unlawful deductions from wages and, alternatively, breach of contract.

The tribunal accepted that the 2020 Bonus Scheme General Criteria made bonus payments discretionary and non-contractual, and that the scheme could be varied or withdrawn without notice. Although the respondent's 29 March 2021 letter said Mr Butt had achieved a £5,500 bonus and would be paid in three instalments in April, July and October 2021, the tribunal held that the letter did not convert the discretionary scheme into a contractual right to fixed payments on fixed dates.

The tribunal found that the respondent was entitled under clause 20 to vary the timing of the bonus payments, including the later decision to move the July and October 2021 instalments. It also found that the respondent's decision not to pay the outstanding instalments was not irrational or perverse, noting the business logic for the delay and the leaver provision requiring the employee to be employed at the date of payment.

Mr Butt resigned on 9 September 2021 and his employment ended on 30 September 2021. By the time the October instalment would have fallen due, he was no longer employed, so the leaver provision meant he was not entitled to that payment. The tribunal therefore dismissed both the unlawful deductions claim and the breach of contract claim. The respondent's separate breach of contract claim was withdrawn at the hearing and dismissed.