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Bhaskar Reddy   10 August 2022

Meaning of active association with emploer

Hi Forum,

I was associated with an employer recently. They paid bonus last year May and stated that we need to return it if there is no active association for 12 months. I have left the company in June this year after serving three months notice period. The company is asking for the bonus back as they are not considering the three months notice period as not active association. What is the legal definition of active association?



 4 Replies

P. Venu (Advocate)     10 August 2022

What is the period for which bonus has been paid? Does it include notice period as well?

Are you still with the same employer?

Please post complete facts.

Bhaskar Reddy   10 August 2022

Thanks for your reply. The bonus was paid on May 31, 2021. I have left the org in June, 2022 after serving three month notice period.

The bonus clause says this exactly - "This amount after deduction of tax, as applicable
would be credited to your bank account along with your May 2021 salary. In case you leave the organization within 12
months for any reason, from the date of payout, you will be required to refund the amount in full to the organization."

Do I need to repay it?

P. Venu (Advocate)     11 August 2022

Is it statutory bonus or ex-gratia. Even if ex-gratia the condition appears to be unfair and unreasonable. You have already left the employer . The contract of emplyement having ceased to exist, the ex-employer can take steps for recovery only through the due process of law. And it is unlikely that they would be successful.

Bhaskar Reddy   11 August 2022

It is one time retention bonus sir. My full and final statement mentions the "Date of Leaving" in June. So, I have not left the company before 12 months. Thanks for your reply.

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