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this employment law video is on bonuses types of bonuses at one end of the spectrum there are non contractual discretionary bonuses a key feature is that theres no obligation on the employer to have a bonus scheme or award a payment in the middle there are bonuses which are partially discretionary bonus schemes may state that employees may be eligible to be considered for a bonus in these cases the employer usually has an obligation to exercise the discretion rationally courts will generally only interfere with the decision if the employer has acted in a perverse irrational or arbitrary way on the other end of the scale there are bonuses which are calculated by reference to specific targets or sales the terms of the bonus scheme will normally be clearer providing an entitlement to a bonus rather than the employer exercising discretion common bonus wording employment contracts often include wording stating that a bonus in one year does not guarantee a bonus in subsequent years and also