A contract may advertise a target bonus while leaving the actual entitlement to another document. The following pressure points deserve attention before the economics are treated as settled.
1. Who sets the targets—and when?
Late or unilateral target setting can create avoidable uncertainty. Check whether objectives are individual, corporate or both, and what happens if no targets are issued.
2. Is payment formulaic or discretionary?
Words such as “may” and “at the board’s discretion” can sit uneasily beside a precise target percentage. The agreement should make the relationship clear.
3. Which document prevails?
If the contract, annual plan and offer letter conflict, a hierarchy clause may decide which promise survives.
4. What is the leaver rule?
Resignation, notice, garden leave and the payment date can each affect entitlement. Read these provisions with the termination clause rather than in isolation.
5. Can past payments create confidence?
A track record may be commercially reassuring, but it does not substitute for checking reservation and repetition clauses. Ask for the current plan and a worked illustration based on the proposed package.
This briefing provides general information, not advice on a specific contract. German employment terms should be assessed against the full agreement and current circumstances.