do you have to share reward money with your employer?

A reader writes:

A friend of mine has been taking certification courses for the last number of months. He just found out he won $1000 for having the highest marks in his class. His employer (a small, 10-person company) has been paying for the courses, but my friend attends the classes and studies on his own time (evenings and weekends).

His question is: who gets the money? Is it his, since it’s his own time and diligence in getting such a high mark, or should he give some (or all) of it to his employer?

I think it’s a pretty big achievement even without the monetary reward, but of course it would be nice to have the money!

He should keep it — he earned it.

I’m not going to promise you that there’s not some crazy employer out there who would demand to have the money handed over to them, in whole or in part, because I’m sure there is. But if we’re talking about how this should work, and how it would work with reasonable employers, your friend should keep the money and have no qualms about it.

His employer is paying for him to attend the courses because it benefits them in some way — it’s a retention strategy and/or they think he’ll gain skills that will benefit them. What he owes to them is to take the courses seriously, attend class, study (which it sounds like he’s clearly done), and abide by the terms of any agreement he has with them about how long he’ll stay at the company once the program is over. But he doesn’t owe them a reward that was given to him specifically for the work that he did in the course. That should be all his.

An employer who would ask for a reward like this to be handed over to them would be one petty employer.

Anyone want to disagree?

{ 26 comments… read them below }

  1. KarenT

    Is the money a gift? Or is it a scholarship/bursary for further study? I’ve never heard of a course just handing out money, but maybe I’ve studied the wrong things! I don’t think he should hand over the money to his employer, but if it’s intended for further study he should consider putting it towards his next course.

    1. Anon

      Agreed. Just to be clear, if this somehow reduces the amount paid for the class, he has to pass that savings on to his employer (or at least have a discussion in which he is willing to do that).

    2. OP

      The money is from a foundation sponsored by the professional organization that is in charge of certifying people. There weren’t any instructions on how to use the money towards another course, so I don’t think it’s a bursary.

      Thanks Alison for your help – my friend is very excited by your response!

  2. OmarF

    Too many years ago, I took courses for a trade I was in. I was top of class and won 200 dollars. There was never any question about who the money was for. I spent it on tools for the trade. However, I don’t believe there was any tuition paid by my employer. They allowed the time off, and reserved a job for me when I was done each session. I received Employment Insurance to cover my living expenses. This was how the apprenticeship program was structured here at the time.

    I don’t remember who provided the prize money, but the program was sponsored and encouraged by the trade association in partnership with government to encourage more qualified trade people. I assume the money came from one of the industry firms with an interest in developing qualified repair people. I ended up leaving the trade a year or two later, but still work in the same industry.

  3. Anonymous

    If it were me, I’d apply the money toward tuition for my next class. If the employer is paying tuition, the employee shouldn’t benefit monetarily unless the employer insists on it. The right thing to do is to reduce the tuition burden.

    1. AdAgencyChick

      But if OP’s friend reduces the tuition burden, is the employer going to correspondingly reduce any obligation associated with the class (say, how long the friend has to stay with that company or else pay back the tuition)? Employer went into this as an investment of $X, not $X minus $1,000; the only reason they’d be able to get $X minus $1,000 as the price is because OP’s friend is an exceptional performer.

      I think if the company asks for the money back, OP’s friend should pay it back, but I agree with Alison that that would be one petty company.

      Besides, won’t OP’s friend have to pay taxes on his winnings? If the company wants to claw the $1000 back they should fork over for the taxes.

  4. Danielle E.

    I believe this should be the employees money 100%. If my employee “won” money, it would be his or hers to keep. If it was a discount that everyone in the class received, then I would expect that to go back to the company.

    I find this similar to airline miles and hotel points. I travel for work and my company pays for my travel. But I am the one traveling, so I keep the airline miles / hotel points.

    1. Katie the Fed

      I’ve always wondered if you get bumped from a flight and get a free voucher for another flight, do you give that to your employer? I’m sure my employer (US Government) has a 20-page guidance statement on that somewhere.

      1. Anon

        Typically, it’s in your name, so you can’t. Some very large companies have other arrangements with certain airlines, so yes, they get that stuff, but I can only think of a few. For example, A-B employees don’t get to keep their own miles.

      2. fposte

        There was a huge thing a few years ago about airline miles for business trips, which the airlines and the flyers felt belonged to the flyers and the employers wanted to claim them as organizational possessions. The airlines and flyers won that one. I don’t know how that translates to a voucher, but it might be the relevant precedent.

      3. aname

        That is different though. Its a replacement due to the travel arrangements provided being different. The prize is a prize and whilst earned on the course is personal… almost like being given a spare piece of fruit or a pair of headphones on a flight paid for by an employer – you wouldn’t seek their approval to keep those and think you needed to turn them into the employer. (Yes, there is a large value difference but as long as it doesn’t appear to be a bribe of any sort its the same principle IMO).

        1. aname

          To clarify: I believe the airline voucher should be used for work purposes and not personal purposes even if it has to be used by the same employee. The other items not so.

  5. jesicka309

    The way I see it, if your friend was in class, and answered a few questions correctly and was given a Starbucks voucher as a reward, there is no way they would be obligated to hand that over. Top of the class is much bigger than that, and the reward is bigger as well.
    I feel like by extension, the money should be kept by your friend BUT they need to be transparent about it. Go in and tell their boss that they were rewarded with $1000 for coming out top of the class. Because as Alison says, some crazy bosses might demand the money be returned to the company. Others might allow them to keep it, but resent it if they find out later he didn’t tell them, because keeping it a secret seems kind of fishy, even if everything is perfectly legitimate. The wrong thing might get back to their boss, and they could demand to know why the $1000 discount they got wasn’t given to the company.
    It is much better to explain to the boss exactly what it is and why you got it – and besides, it’s a great opportunity to make sure their boss KNOWS how awesome they did at the course.

  6. OmarF

    To add another thought. I think a good boss would be proud to have an employee who was top of class. There will be some who will even add to the reward (I bet my boss would support me providing a dinner voucher to one of my staff in this case). At the very least, there should be recognition within the company that the prize was earned by the employee. What a great way to show the rest of the employees that their employer appreciates having quality employees on staff. Trying to claw back the money would be a huge mistake affecting the moral of all employees.

  7. Ryan

    In short, the money was a reward for performance in the class, not paying for the class. Since the former was done by the friend, and the latter by the employer, unless the employer slipped the class participant the answer key, the money is solely that of the party responsible for the performance–your friend.

  8. FreeThinkerTX

    Back in the 90’s I was an Executive Assistant to the President of a medium-sized software company (cough.. SHIMS.. cough). This President made every employee turn over their business airline travel miles to him because, “If it wasn’t for the company [i.e., ME, the president] then you wouldn’t be earning those miles!”

    It didn’t help morale much that he used the miles to take his mistress(es) on luxury cruises.

    It also didn’t help *me* much that, as his assistant, I had to (A) Keep his personal refrigerator stocked with gin; (B) Clean the residue from his glass-topped desk after he’d snorted coke; (C) Make up business reasons for the receipts on his expense report from strip clubs; and (D) Put up with statements from him in public like, “I had a dream that you and I were working late last night, and you came over and put your head in my lap.” [My response was, “Holy crap! I guess it says something about my work ethic when I’m sleeping on the job even in your dreams!”]

    After I quit (shortly after the “dream” comment), the company was bought out by an Australian competitor. They had the President at their NYC offices when the top members of each department called the CEO of the Australian outfit and said that if the President was kept on board, every single f-ing employee of the represented departments would quit, starting with the senior-most ones who were on the conference call. Luckily, the Aussies were smart enough to send the President packing.

    It’s the only instance of Corporate Comeuppance I know of.

    P.S. But during the President’s reign, there was always a full keg of beer in the kitchen. Employees had to wait until 4:00 pm each day to tap it, though.

  9. Tiff

    I agree, the employee should keep it. My husband was in a similar situation recently, where he won a brand new ipad for being top of class. Fortunately for him, he put it best use and gave it to his loving wife, haha.

  10. Elizabeth West

    He should keep it. He earned it. It doesn’t belong to his boss, who was not the one who did the work. I do agree he should disclose the award, however. Hopefully the boss isn’t a jerk.

  11. Miss Displaced

    I agree that this is “prize” money and it belongs to the employee.

    The only way I could see returning it to the company would be if the company had some type of scholarship fund program for employees or children of employees. In that case it would be a nice gesture to return it to the scholarship fund since the class was paid for by the company.

  12. JessB

    If this was me, I’d take everyone out for $500 worth of lunch, so something similar, maybe after co-ordinating with my boss. I’d want to share with the company and with my work mates who helped to make it possible, as well as getting some recognition for myself for being such a star! Congratulations to the OP’s friend, that’s a great reward for what must have been hard work and dedication.

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