Claimant v DPD Group UK Limited
Outcome
Individual claims
The tribunal found the MIPP payment was discretionary and not a contractual entitlement. The policy expressly stated the employer could withhold payment if an employee was under suspension or investigation at the time of payment. Since DPD had not exercised its discretion to pay Mr Lawson because he was suspended when payment was due, no entitlement ever arose and there could be no unauthorised deduction from wages.
The tribunal held that DPD's failure to exercise its discretion to pay the bonus was not arbitrary, capricious or unreasonable. The MIPP payment was expressly discretionary, and DPD applied the express exclusion for employees under suspension at the payment date. Even after dismissal for gross misconduct, it was not unreasonable to continue withholding the discretionary payment. Therefore there was no breach of contract.
Facts
Mr Lawson was employed by DPD from December 2021. He was suspended on 13 February 2025 following a workplace incident and subsequently dismissed for gross misconduct on 10 March 2025. He claimed a £6,000 yearly bonus (MIPP payment) for January 2024 to January 2025, which was due to be paid on or around 21 February 2025. DPD withheld the payment because he was suspended at the time it was due, relying on an express policy provision allowing withholding where an employee was under suspension or investigation.
Decision
The tribunal dismissed both claims. The MIPP payment was expressly discretionary and not a contractual entitlement. DPD had not exercised its discretion to pay because Mr Lawson was suspended when payment was due. There was no entitlement to bring an unauthorised deduction claim until discretion was exercised, and DPD's failure to exercise discretion was not arbitrary, capricious or unreasonable given the express policy terms and Mr Lawson's suspension and subsequent dismissal for gross misconduct.
Practical note
Discretionary bonus schemes with clear contractual language reserving the employer's discretion and express exclusions for suspended or dismissed employees will not create enforceable payment rights, and withholding payment in accordance with those terms will not constitute breach of contract.
Legal authorities cited
Case details
- Case number
- 6023339/2025
- Decision date
- 3 October 2025
- Hearing type
- full merits
- Hearing days
- 1
- Classification
- contested
Respondent
- Sector
- logistics
- Represented
- Yes
- Rep type
- barrister
Employment details
- Service
- 3 years
Claimant representation
- Represented
- No