Bonus Agreement Template (Gibraltar)
Updated on 13 August 2026
Gibraltar's principal employment statute, the Employment Act 1932 as amended, is styled on British industrial law and incorporates older English statutes addressing unauthorised wage deductions, including the Truck Act 1831. An employer cannot make an unauthorised deduction from wages that takes pay below the statutory minimum except for statutory deductions, and records must clearly show the amount and reason for any deduction.
This template builds a bonus clawback around that consent-based deduction framework, and adds good-leaver terms the widely copied free version omits entirely.
Tap any highlighted blank in the document below and type straight into it.Free — no sign-up, no watermark
Bonus Agreement
- Date:
- Employer:
- Employee:
This bonus is an earned entitlement on the conditions set out in this Agreement.
1. Targets
The targets for are:
2. Payment
Any bonus payable is paid on through payroll, subject to tax.
If the Employee's employment ends by redundancy, a pro-rata bonus is payable on the normal payment date.
3. Clawback
The Employee agrees in advance, in writing, that the Employer may require repayment within months of payment for gross misconduct or materially inaccurate results, sought by invoice rather than an unauthorised deduction from wages.
4. General
This Agreement is governed by the laws of Gibraltar.
For the Employer
Date:
Employee
Date:
Do not put a clawback into the wage-deduction trap
Deductions beyond statutory ones need the employee's consent, and records must clearly show the amount and reason. This template's clawback is agreed in writing in advance, bounded by a recovery window and defined triggers, with repayment sought by invoice rather than an unexplained deduction.
Write in good-leaver terms
This template keeps the active-employment condition as the default but adds carve-outs for death, incapacity, redundancy and the end of a fixed term, each with pro-rata payment.
Clause-by-clause guide
- Nature of the bonus
- States whether the bonus is discretionary or an earned entitlement.
- Targets and calculation
- The performance period and the formula or amount.
- Eligibility and leavers
- The active-employment condition plus good-leaver carve-outs.
- Clawback
- Written consent in advance, a bounded recovery window, and repayment on invoice.
Gibraltar compliance checklist
The Employment Act 1932 sets the rules on wage deductions.
Get consent before any clawback deduction
Deductions beyond statutory ones need the employee's consent, and records must clearly show the amount and reason for any deduction.
Gibraltar employment law overviewKeep clear deduction records
Maintain records showing the amount and reason for any deduction from wages.
How to complete the bonus agreement
- Choose the type of bonus. Decide discretionary or earned.
- Set the targets and payment date. Add the criteria and payment date.
- Choose leaver terms. Switch on good-leaver carve-outs.
- Set the clawback. Get written consent in advance and bound the recovery window.
Frequently asked questions
Can a clawback be deducted from my pay in Gibraltar?
Only with consent — deductions beyond statutory ones need the employee's agreement, and records must clearly show the amount and reason.
Can I lose my bonus if I am made redundant first?
Under this template, no — a pro-rata bonus is payable on redundancy.
Is the bonus taxed like my salary?
Yes — a bonus paid to an employee is treated as earnings.
Can the employer change the bonus criteria mid-period?
Not under this template, except by agreement or where an unforeseen event makes a target meaningless.
Does maternity or other family leave affect my bonus?
Under this template, no — qualifying leave counts towards eligibility on the same basis as time worked, and targets are adjusted rather than applied as if the employee had been at work throughout.
Related templates
Disclaimer
This template and guide are for general information only. They are not legal advice, and no Gibraltar-qualified lawyer has reviewed or approved them.
