Do I have to repay a signing bonus if I agreed to?
I worked for a power company and Light for 22 months, but I had a signing bonus of $12,000 that had a stipulation that I must work there for 24 months or I must pay the bonus back in full. They sent a letter requesting that I repay almost double the bonus. There have been people in the recent past who had retention bonuses of over $100,000 that the company did not pursue. Should I ignore the request?
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The short answer? You probably do owe the original $12,000 bonus back under the contract terms since you left before 24 months. However, the additional amount they’re asking for may be inflated or misapplied. It sounds like the Social Security and Medicare language is being used to justify the extra amount, but that shouldn’t be your burden because it’s their responsibility as the employer to handle payroll taxes.
Don’t ignore the letter; respond in writing and ask for a breakdown of how they calculated the total, especially the extra amount.
Longer explanation: Ignoring it can lead to collections or legal action. You should respond in writing and ask for an itemized breakdown of the full amount they’re demanding, including how much is for the bonus and how much is supposedly for tax repayment.
If the contract doesn’t state you owe Social Security or Medicare reimbursements—and if they withheld taxes when they paid you—then that portion likely isn’t on you. You’re not typically required to “repay” taxes the company already submitted to the IRS or SSA.
Get that letter in writing and ask for a full breakdown. Once you have it, you can compare it to your paystub or the original agreement. If they can’t justify the extra charges, you have a basis to negotiate or challenge it.
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I worked for a power company for 22 months, but I had a signing bonus of $12,000 that had a stipulation that I must work there for 24 months or I must pay the bonus back in full. They sent a letter requesting that I repay almost double the bonus. There have been people in the recent past who had retention bonuses of over $100,000 that the company did not pursue. Should I ignore the request?
Lexi, Chatbot
I understand how concerning it must be to receive a repayment request for your signing bonus. Can you tell me if you have already communicated with Florida Power and Light regarding their request?
I have not.
Lexi, Chatbot
Have you kept any documentation or correspondence related to the signing bonus and the company’s policies on bonuses?
I only have pictures of it. My brother has the documents. The company does not have my current address.
Lexi, Chatbot
Is there anything else the employment lawyer should know before I connect you? Rest assured they’ll be able to help with your bonus repayment request.
No
Legal Eagle
Hello! Legal Eagle here, and I am an attorney specializing in your area of law. I am more than happy to help you with your situation! Can you provide more information about the repayment letter—specifically, why they are requesting almost double the original bonus amount?
Apparently, the contract also has a Certification of Social Security and Medicare Repayment section, and maybe that is where the excess comes from, but there is no calculation for that.
I don’t know why I would have to pay them something that I already paid the government, though.
Legal Eagle
Ok, thanks! Just a few more questions. Is there any language in the contract that specifies how the Social Security and Medicare repayment is calculated, or what the total amount would be?
The only thing the clause says about it is: “I hereby certify that on the date below, I signed an agreement(s) with Florida Power and Light (the ‘Company’) for certain monies and/or benefits as set forth in my offer letter.”
Legal Eagle
Ok! I’ve been working on an answer while we’ve been chatting, so it’ll just be a moment.
Legal Eagle
I’m so sorry about this situation! I want to address it with a detailed response, so if you have any questions, don’t hesitate to ask—this law stuff can get complicated.
Legal Eagle
The short answer? You probably do owe the original $12,000 bonus back under the contract terms since you left before 24 months. However, the additional amount they’re asking for may be inflated or misapplied. It sounds like the Social Security and Medicare language is being used to justify the extra amount, but that shouldn’t be your burden because it’s their responsibility as the employer to handle payroll taxes.
Don’t ignore the letter; respond in writing and ask for a breakdown of how they calculated the total, especially the extra amount.
Longer explanation: Ignoring it can lead to collections or legal action. You should respond in writing and ask for an itemized breakdown of the full amount they’re demanding, including how much is for the bonus and how much is supposedly for tax repayment.
If the contract doesn’t state you owe Social Security or Medicare reimbursements—and if they withheld taxes when they paid you—then that portion likely isn’t on you. You’re not typically required to “repay” taxes the company already submitted to the IRS or SSA.
Get that letter in writing and ask for a full breakdown. Once you have it, you can compare it to your paystub or the original agreement. If they can’t justify the extra charges, you have a basis to negotiate or challenge it.
If a repayment obligation is triggered, I certify to the following:
- I will not, now or in the future, claim a refund or credit for the excess Social Security, if applicable, and Medicare withholding pertaining to the repayment obligation.
- I have given the company permission to request a refund or credit of my excess Social Security, if applicable, and Medicare withholding from the IRS.
Legal Eagle
I understand your concerns!
That clause doesn’t alter your main obligation. It simply means that if you repay the bonus, you’re agreeing not to double-dip by claiming back Social Security or Medicare taxes on your own. You’re also allowing the company to manage any tax recovery directly with the IRS. This doesn’t mean you owe more money; it only affects who can request a refund for taxes that have already been withheld.
Does it matter the conditions in which I left? The workplace was very toxic from the new manager and we were constantly being told that the position was going to be retired.
Legal Eagle
I hear you! Unfortunately, the reason you left likely doesn’t matter if the contract clearly states you must stay 24 months to keep the bonus. Although the workplace was toxic or your position was being phased out, the repayment clause still applies unless the agreement includes exceptions. That said, those circumstances might give you leverage to negotiate a reduced amount or settlement.
I was a good employee even at the end of my tenure. Should I include wording in the letter that maybe I should not have to pay the full amount?
Legal Eagle
I hear you! I wouldn’t include that. They don’t necessarily care about that, and the law doesn’t make it relevant to your situation—I’m so sorry.
There is a clause about an exemption if the company eliminated the position. Sadly, I left before they did.
Legal Eagle
I hear you! I’m so sorry that this is happening to you. I know how frustrating this can be. Did you have any other details or concerns you still needed addressed?
In the recent past, people with much larger bonuses did not get pursued for their bonuses. What could be a consequence of ignoring the letter?
Legal Eagle
The company isn’t required to treat everyone the same, so just because others weren’t pursued doesn’t mean they can’t enforce it against you. If you ignore the letter, they could send the debt to collections, report it to credit agencies, or sue you in court for breach of contract. Responding gives you a chance to negotiate or challenge the amount before things escalate.
Don’t they first have to send a lawyer’s demand first and then decide to send a lawsuit summons, and after that they can decide on sending it to collections?
Legal Eagle
They don’t, actually. Legally speaking, they could go straight to a lawsuit, but usually they use a lawyer’s demand letter first.
About how much does it cost to start a lawsuit?
Legal Eagle
Filing fees for a lawsuit vary by state but typically range from $200 to $500 just to initiate the case in civil court. On top of that, attorney fees can quickly add up—often several thousand dollars if the case goes beyond basic filings. If they sue you, they might try to recover those legal costs too, depending on what your contract says.
Legal Eagle
Did you have any other details or concerns you still needed addressed?
Legal Eagle
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