Colorado Politics

Appeals court says divorcing spouse not entitled to other’s job bonus

A woman’s bonus at her job was not marital property that she had to split with her husband in their divorce, the state’s Court of Appeals has ruled.

Extending the Colorado Supreme Court’s previous decisions about stock options and paid leave, a three-judge panel for the appellate court decided that because Cassandra Turner’s employer controlled the size of her bonus, and also whether to give her one at all, it did not fall under the marriage’s division of assets.

The Supreme Court has directed judges to focus on whether a spouse has an “enforceable right” to any employment benefits. In a 2014 decision, the court elaborated that if a work agreement or policy establishes a right to paid vacation or sick leave, for example, the leave that accrues during the marriage is property to be divided in a divorce.

In Turner’s case, her employer had an incentive program that would pay annual bonuses of varying sizes. The bonuses were not guaranteed, and were awarded after the calendar year had ended. At the time of the final divorce hearing in January 2021, Turner’s company had not yet decided on bonuses for 2020.

Weeks after the hearing, Turner received “substantial bonuses,” according to the Court of Appeals. Her husband, Benjamin Turner, contended those payments should have been part of the divided assets because they related to work Cassandra Turner performed during their marriage.

Judge Ted C. Tow III, in the March 31 opinion for the appeals court, concluded there was no evidence at the time of the final hearing that Turner would receive a bonus, meaning she had no enforceable right to that form of compensation. Although Turner had received a bonus every year since 2010, her company’s director of compensation testified he was unaware of any intended bonus awards as of January 2021.

“If a court were to find such testimony incredible or conclude that the employee spouse and the employer were somehow in cahoots to obstruct the other spouse’s claim to the bonus,” cautioned Tow, “it may well conclude that the bonus was more than a mere expectancy. Because the district court here found the employer credible, however, we must conclude that the record supports the finding that wife did not yet have an enforceable right to the bonus.”

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iStock Photo by IcemanJ

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