Bonus and commission in settlement agreements
How bonuses and commission are treated on exit, why plan rules matter, and what to negotiate in a settlement.
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Contractual vs discretionary
Bonuses and commission can be contractual or discretionary. Your entitlement on exit may depend on plan rules, performance conditions, and whether you must be employed on a payment date. Read scheme documents alongside your settlement draft.
Negotiating inclusion
If a bonus is genuinely at risk, you may still negotiate a partial buy-out or a warranty in the agreement. Senior roles may involve LTIPs or equity—seek specialist input.
Tax and NICs
Treatment varies by payment type. Coordinate with tax guidance and payroll.
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