A discretionary bonus, a missed KPI deadline, and a $10,000 lesson for employers
A New Zealand general manager who resigned claiming his employer breached his bonus terms has lost his constructive dismissal case, with the Employment Relations Authority finding he had misread the very clause he relied on.
In a determination dated 1 May 2026, Authority member Geoff O'Sullivan ruled that Phil Jacklin was not constructively dismissed by Planit Software Testing Limited, although the company was ordered to pay him $10,000 for disadvantaging him in his employment by failing to set his KPIs at the beginning of the financial year.
Jacklin was employed by Planit in November 2023 as General Manager Central, with his first day of employment on 22 January 2024. His employment agreement made him eligible for a short-term incentive bonus of up to 25 per cent of his annual salary. Clause 6.2 stated that KPIs and eligible amounts would be set at the beginning of each financial year, with all bonuses and incentives at the absolute discretion of the Chief Operating Officer or Chief Executive Officer.
The trouble began when the new financial year rolled around on 1 April 2024 and no KPIs had been set. Planit was undergoing an international restructure, and Jacklin's emails chasing the issue from 8 April 2024 onwards drew only limited responses. He received a verbal update in April from Executive General Manager Ramandeep Singh Sethi, who said he was still waiting on the Chief Revenue Officer, Jason Bargent, for an update. After escalating to Head of People Australasia Emma Brbich on 6 August 2024, he received a reply on 12 August saying she would have something back to him within a week. Jacklin believed the bonus should be paid quarterly, a view he said reflected industry norms and his previous roles.
By May 2024, Jacklin was venting in writing. "Let's talk comms plans. I'm miffed that we don't have comms plans yet," he wrote to Bargent and Sethi, adding that until a comms plan came, he assumed achieving 100 per cent of his budget would earn 100 per cent of his comms plan, "calculated and paid quarterly."
Planit's position was different. Sethi said he had told Jacklin the scheme was annual, not quarterly, with the incentive period running through the financial year from 1 April to 31 March, and that only Business Development Directors had contractual provisions for quarterly STIs. Sethi also disputed Jacklin's account of an April meeting, noting that the date Jacklin nominated — 25 April 2024 — was ANZAC Day. Brbich said STIs were paid annually after the completion of audited accounts, and that the delay reflected board-level work to address sustained budget deficits driven by changes in the IT landscape, the rise of AI and greater competition.
Jacklin emailed Brbich again on 29 August 2024 pressing the issue, then took a planned holiday from 6 to 24 September 2024. On his return he found no response from Brbich and resigned by email on 26 September 2024, citing a material breach of contract. In his Statement of Problem he sought reimbursement of lost wages, $25,000 for Planit's unjustified actions, $50,000 for unjustified dismissal, a $19,720 first-quarter bonus payment, and two $5,000 penalties. Planit wrote to him the next day asking him not to resign, but Jacklin said he had lost confidence in the company's ability to resolve matters.
The Authority did not see it his way. O'Sullivan found the agreement, on a plain reading, did not say what Jacklin believed it did. The bonus was discretionary, capped at up to 25 per cent, and payable annually. Jacklin's argument that pluralised wording in clause 6.2 implied quarterly payments was described as "strained and inconsistent with the plain wording of the clause."
Evidence also emerged that Jacklin had messaged colleagues before resigning. He told the General Manager Southern, "I'm v. soon on my way out though," and added, "At least you got a heads up. Raman isn't even going to get that." Sethi viewed the resignation as premeditated and intentionally timed.
Still, Planit did not walk away unscathed. The Authority found the company breached an express contractual term by failing to set Jacklin's KPIs and eligible amounts at the beginning of the financial year, noting that even on a liberal interpretation of the provision, Planit had not done so. Jacklin was awarded $10,000 for the humiliation, loss of dignity and injury to feelings he suffered as a result of that disadvantage. A penalty was declined on the basis that the award already remedied the breach, and costs were reserved.
The case is a sharp reminder that discretionary bonus schemes still come with hard contractual obligations. Vague timing, undefined KPIs and unanswered emails can crystallise into liability, even when the underlying payment remains entirely at the company's discretion. Clear drafting, prompt written communication and structured updates during restructures matter, particularly for senior hires whose remuneration is heavily weighted toward incentives.
