Claimant v Vedanta Resources Limited
Outcome
Individual claims
The tribunal found the claimant had a contractual entitlement to a £150,000 performance bonus based on the terms of his offer letter and oral assurances from HR. He met all deliverables and targets as confirmed by his manager's Grade A rating. The respondent's reduction of the bonus to £60,000 (a deduction of £90,000) was unauthorised as it was not justified under the agreed terms, which tied bonus payment solely to achievement of agreed deliverables/KPIs.
This claim was pleaded in the alternative to the unlawful deduction from wages claim on the same facts. The tribunal stated that had the wages claim failed, the breach of contract claim would have succeeded, but as the wages claim was successful, the breach of contract claim was not determined.
The claimant's claim for financial loss (increased mortgage payments) attributable to the unauthorised deduction was withdrawn at the close of submissions and dismissed.
The claimant's claim for notice pay was withdrawn at the outset of the hearing and dismissed.
The claimant's claim for unpaid holiday pay was withdrawn at the outset of the hearing and dismissed.
The claimant's claim for wrongful dismissal was withdrawn at the outset of the hearing and dismissed.
Facts
The claimant was employed as Director of Corporate Finance from April 2023 to February 2025 on a base salary of £165,000 plus a performance bonus of up to £150,000. His offer letter stated he would receive the bonus if he achieved agreed deliverables and KPIs set by his manager. He achieved a Grade A performance rating and met all his targets, but received only £60,000 of his expected £150,000 bonus in September 2024. The respondent claimed the bonus was discretionary and subject to various company performance parameters outlined in a Bonus Policy document that the claimant had never seen during his employment.
Decision
The tribunal found the claimant had a contractual entitlement to a £150,000 bonus dependent solely on meeting his personal deliverables and targets, as stated in his offer letter and confirmed by HR before he accepted the role. The respondent failed to justify or explain how the £60,000 figure was calculated or demonstrate that the claimant had not met the agreed criteria. The £90,000 shortfall constituted an unauthorised deduction from wages.
Practical note
Offer letters containing bonus terms form part of the contract of employment and cannot be overridden by undisclosed internal policies; employers must clearly explain and justify any reduction from contractually promised bonus amounts or risk liability for unlawful deduction from wages.
Award breakdown
Award equivalent: 28.4 weeks' gross pay
Legal authorities cited
Statutes
Case details
- Case number
- 6002583/2025
- Decision date
- 5 June 2025
- Hearing type
- full merits
- Hearing days
- 1
- Classification
- contested
Respondent
- Sector
- other
- Represented
- Yes
- Rep type
- barrister
Employment details
- Role
- Director of Corporate Finance
- Salary band
- £100,000+
- Service
- 2 years
Claimant representation
- Represented
- Yes
- Rep type
- barrister