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We're all interested to know the cause..That being said, I would ignore them. Worst case scenario, they come after you and you'll have to pay it back anyway but I would view that as a pretty unlikely outcome.
I have no idea why you were terminated, but assuming you do actually owe the money you'll owe the entire (gross amount). Your old firm doesn't care what you paid in taxes, they paid $10k for you to join their firm - they want their $10k back.
I have no idea what sort of arrangement gets worked out if you can't pay the $.
Not 100% true I was in a similar situation a few years back and was only obligated to pay the after tax amount.
http://www.hrlaws.com/forum/showthread.php?t=54227
http://www.irs.gov/uac/Publication-525,-Taxable-and-Nontaxable-Income--1
This is like a worst case scenario.. It's not like you've been with the firm and are debating over a couple grand in relocation expense. I would try to ignore them and then negotiate if they use a collection agency.
you were fired and they want bonus back? this sounds fishy
Sorry to hear.
I'm actually not sure if the "ignore" advice works here, but take this with a grain of salt.
It'll be the full amount but you should also get a tax refund on the 5k you paid in taxes too
I don't know if you have to pay the entire 10k, at my firm it says that if you leave before your time is up you have to give back a prorated amount based on how long you've worked. Like if you worked for 1 year of your 2 year analyst contract, you would only pay back half or 5k. I'd check your offer letter/contract.
They want you to pay the $10k (gross) amount (could be prorated depending on the bank) but you can claim your tax portion back when you do your taxes next year.
That being said, my friend quit MS a few years back and they also asked him for his signing bonus. He just ignored them and nothing happened. I honestly doubt they'll come after you, $10k is peanuts to them. Associate signing bonuses (~$40,000) are probably another matter.
There's a lot of "ignore them" posts here, haha.
If OP's contract states that he must repay, how far can the company push it? A lawsuit just for $10k?
Of course they would never file a lawsuit! But do you really want to have a $10k charge sent to collections on your credit history? Banks are literally in the business of collecting on unpaid debts, it is unwise to underestimate their ability to inflict pain without spending a day in court.
This. +1 Best advice so far. Who cares if they actually decided to sue? It's a contractual debt that they would easily sell off to a collections agency that would be negative on your credit report, and also would be a ding if future employers pulled your credit and figured out that you got fired with cause and had to repay a bonus. Can't church up your story with that kind of paper trail.
what was the cause?!
maybe he didn't pass his series exams?
I don't know what the cause is. But I would moan to whoever your boss was. Explain to him you don't have the money, you have no job, and you would really appreciate if he were to contact HR to forget about it.
Otherwise don't ignore. And as said previously it's the full 10k that is owed.
Can the boss really do anything about it? I mean, it's HR (different division).
He will if he wants - he can easily shoot an email to whoever the HR person is in charge and tell her to forget it. He won't bother for 10k, and if he feels sorry for you an email won't cost him anything.
Remember that HR and front office staff are not alien to each other, we do talk between departments!
ignoring is obviously not the best option, still try to get rid of it legally, i.e. asking them to forget that.
Wait, you really have to pay it after they fired you? I only had to do it (post-tax) because I resigned...
Check your employment contract. It's a bit odd that they want their bonus back after they fired you. Typically, that only happens when someone quits.
I say do nothing until you get a letter (or a call) from their lawyers - I rarely trust HR.
If I remember correctly, the standard IB contract that I signed read to the effect of "if your employment with XYZ bank ends before a period of one year for any reason..."
You definitely don't want to ignore it. You already have a black mark on your resume being fired for cause, don't add delinquent debtor, especially if you want a career in at a bank.
Crappy situation indeed. Sorry, man.
How can OP turn things around? Should he just be tactful when future interviewers ask him?
That all depends on what "cause" means. If he just didn't pass exams or didn't hit sales numbers for PWM type roles then he can be honest and put a bit of spin on it. If it was related to ethics or confidentiality he will have trouble getting employed again in the financial sector by a large firm. He might be okay in small markets.
That is my experience. A girl I know got caught expensing shopping sprees and furniture and she eventually got a job in industry, but only because the firm didn't press criminal charges.
Not to be contrite, but you should probably consult a lawyer. I don't think that turning your back on something like this ends well. Remember, industries are smaller than you think and you don't want to be that guy who got fired for cause and then ignored bonus repayment requests pissing people off. It's obviously not a major sum in the grand scheme of things, but when money comes into play things get weird quickly.
My buddy quit a S&T program post MBA, and they asked for his signing bonus back. He said "OK" and then just need mentioned it again and nothing happened.
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