Burns v. RBS Securities Inc. d/b/a Royal Bank of Scotland
Absent a contract obligation to pay a bonus, an employee may not be entitled to claim that an employer wrongly withheld the employee's wages, in violation of Connecticut General Statutes §31-72. The plaintiff employee, Bryan Burns, worked at Greenwich Capital, which was acquired by the Royal Bank of Scotland, and won a promotion to supervisor. Between 2005 and 2007, the plaintiff's base salary was $200,000, and his annual bonuses ranged from $255,750 to $351,000. In or about 2008, the defendant employer was about to declare bankruptcy and required a bailout from the United Kingdom, which acquired a significant ownership interest in the employer. A new bonus structure provided that bonuses would vest during a three-year period, and that a worker who departed from the company during that time would not receive any portion of the bonus that had not yet vested. The plaintiff resigned in June 2009 and sued to recover his unpaid bonus, alleging breach of contract and violation of C.G.S. §31-72. The defendant employer argued that because the plaintiff departed voluntarily, he was not entitled to a bonus. The employee manual provided, "[E]mployees will be eligible to receive a discretionary bonus at the end of each year." The court rejected the plaintiff's claim he was entitled to a $198,000 bonus. There was no contract that guaranteed a bonus every year. The defendant employer's performance was a significant factor with respect to employee bonuses. The employer possessed the discretion to withhold bonuses if there was insufficient money, and it exercised that discretion. The plaintiff failed to prove breach of contract. "There is no evidence," wrote the court, "that the defendant's decision to make no dollars available for cash bonuses was arbitrary, inconsistent with past practices or discriminatory." The court granted judgment to the defendant employer.