Using Clawback Provisions For Employee Incentive Pay

Law360 (August 26, 2019, 3:55 PM EDT) -- This article addresses the wage-and-hour implications of clawback and forfeiture provisions and provides drafting considerations for incentive compensation agreements. Clawback provisions require employees to pay back money to employers that they already received whereas forfeiture provisions provide that employees forfeit the right to receive money when specified conditions occur.

The article covers the types of compensation often subject to clawback and forfeiture provisions and addresses the circumstances where payments may or may not be forfeited or clawed back. It also discusses whether compensation subject to a clawback/forfeiture provision constitutes "wages" under state law.

Specifically, this article provides practical guidance on the...

Stay ahead of the curve

In the legal profession, information is the key to success. You have to know what’s happening with clients, competitors, practice areas, and industries. Law360 provides the intelligence you need to remain an expert and beat the competition.


  • Access to case data within articles (numbers, filings, courts, nature of suit, and more.)
  • Access to attached documents such as briefs, petitions, complaints, decisions, motions, etc.
  • Create custom alerts for specific article and case topics and so much more!

TRY LAW360 FREE FOR SEVEN DAYS