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Offer Letter Sign-On Bonus

Asked May 30, 2007, 04:03 PM — 2 Answers
I accepted employment at a company that gave me a $30,000 sign on bonus to compensate for forfeiting a semi-annual bonus at my last company. The offer letter stated that if I left prior to 2 years of service that I have to pay back in full. (Employment is in California) If I have already paid $10,000 in taxes and have worked 1 year, shouldn't I be responsible for paying less than the $30,000? Beyond withholding my last paycheck, how can a company enforce payment?
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RubyPitbull's Avatar
RubyPitbull Posts: 3,581, Reputation: 3322
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#2

May 30, 2007, 04:21 PM
They can sue you for it. And, expect them to follow through. Most companies do not put that kind of stuff in writing unless they are dead serious about it.

P.S. Doesn't matter if you paid taxes on it. You obligated yourself to repay the $30K in full. I suggest you stay put for another year.
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ebaines's Avatar
ebaines Posts: 10,136, Reputation: 5589
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#3

May 31, 2007, 04:55 PM
If you do pay the money back, the company is obligated to report the payment as a credit on your W2 for the year, so at least you will be fair-and-square with Uncle Sam.
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