Overview: Employers often provide bonuses to employees as some type of incentive. Bonuses take various forms and each type has its own particular effect on employee compensation as well as federal income and employment tax consequences.
Rena Pirsos, JD, Legal Editor
Updated to reflect the DOL's new FLSA regulations, effective December 1, 2016.
In Sommer v. Vanguard Group, 461 F.3d 397 (3d Cir. Pa. 2006), the 3rd Circuit Court of Appeals addressed whether an employer interfered with an employee's Family and Medical Leave Act (FMLA) rights when it reduced the employee's yearly production bonus because of his time out on FMLA leave.
Attracting, motivating and retaining talent is critical to an employer's short- and long- term success. This section assists HR professionals in implementing a comprehensive, integrated total rewards strategy that can help achieve those important objectives.
HR guidance on types of bonuses paid to employees and their compensation and tax consequences.