Fired to Avoid Paying Bonuses: Bad Faith Terminations in Alaska
Firing an employee right before they earn a bonus, commission, or seasonal payout is illegal in Alaska. This violates the state's strict implied covenant of good faith, allowing you to sue for the full amount of the compensation you rightfully earned.
Alaska is home to some of the most lucrative, high-stakes seasonal industries in the United States. From the icy oil rigs in the Arctic to the turbulent waters of the Bering Sea, workers endure grueling conditions for the promise of massive end-of-season bonuses or crew shares. Unfortunately, some greedy employers attempt to cheat their workers by firing them just days or weeks before these big payouts are due.
If you were terminated abruptly right before you were supposed to get paid your bonus or commission, you have strong legal options. We highly recommend using our US Attorney Directory to find a tough, local employment lawyer in Alaska. An attorney can help you hold corrupt companies accountable and force them to pay every dollar you earned.
The Financial Motive Behind Bad Faith Firings
In Alaska, the law recognizes that employers sometimes act out of pure financial self-interest. Firing someone specifically to avoid paying them a promised benefit is a direct violation of the implied covenant of good faith and fair dealing. Courts look closely at the timing of the termination. If you had a spotless employment record for months, and were suddenly fired for a trivial reason right before a payday, the court may presume the employer acted in bad faith.
North Slope End-of-Season Bonuses
Workers on the North Slope, including Prudhoe Bay and Deadhorse, often work rotational shifts (like two weeks on, two weeks off) or long seasonal contracts. Many oil and gas contractors offer "end-of-season" or "project completion" bonuses to keep workers from quitting early. If an employer fires a roughneck or pipeline welder on day 85 of a 90-day contract for being "five minutes late to a safety meeting," it is highly suspicious. This is a classic example of a bad faith firing designed to save the company thousands of dollars in bonus payouts.
Commercial Fishing Share Denials
The commercial fishing industry in towns like Dutch Harbor, Kodiak, and Homer operates on a unique payment system. Deckhands are typically paid a "crew share"-a percentage of the total catch value-rather than an hourly wage. Unscrupulous captains have been known to fabricate reasons to fire a deckhand right before the boat offloads its catch at the cannery, attempting to divide the fired worker's share among the rest of the crew or keep it for themselves. Under Alaska law, if you performed the work, you are generally entitled to your proportional share of the catch.
Real Estate and Sales Commissions
This issue is not limited to remote job sites. In cities like Anchorage and Fairbanks, real estate agents, software salespeople, and auto dealers face similar threats. If a salesperson spends months negotiating a massive commercial property deal, and the brokerage fires them two days before the closing date to avoid paying the 3% commission, that is objective bad faith. The employer cannot use a termination to steal the fruits of your labor.
Calculating Lost Wages and Filing a Claim
When an employer fires you to avoid a payout, you are not just fighting for your hourly wage; you are fighting for the full value of the contract. Under AS 23.05.140, employers are required to pay all wages due within specific, tight timeframes after termination. Bonuses and commissions often fall under this umbrella if they were already earned.
Step-by-Step: How to Recover Your Money
If you were cheated out of your compensation, you must act strategically to build a solid case.
- Step 1: Secure Your Contract. Gather your employment agreement, crew contract, or compensation plan that outlines exactly how and when bonuses or commissions are paid.
- Step 2: Collect Evidence of Performance. Save copies of your sales metrics, fish tickets, or project completion reports to prove you met the requirements for the payout.
- Step 3: File a Wage Claim. You can file a formal Wage Claim Form with the Alaska Department of Labor and Workforce Development Juneau. They can investigate claims for unpaid wages and bonuses.
- Step 4: Hire an Attorney for a Lawsuit. For large bonuses, crew shares, or complex commissions, state agencies may move too slowly. Hiring a private employment attorney allows you to file a wrongful termination lawsuit directly in civil court.
What Can You Win in Court?
If a judge or jury determines you were fired in bad faith to avoid a payout, the penalties for the employer can be severe.
| The Stolen Bonus or Commission | The court will order the employer to pay the exact amount you would have earned had you not been wrongfully terminated. |
| Statutory Penalties | Under Alaska law, if an employer willfully fails to pay wages due upon termination, you may be entitled to penalty pay for up to 90 days. |
| Pre-Judgment Interest | You can recover interest on the money that was withheld from you, calculated from the day it should have been paid. |
Frequently Asked Questions (FAQ)
My contract says 'must be employed on December 31 to receive the bonus.' I was fired on December 29. Can I still get it?
Yes, it is highly possible. If the court finds that the employer intentionally fired you on December 29 specifically to prevent you from being employed on December 31, they will likely strike down that loophole and award you the bonus.
What if the employer claims I was fired for poor performance?
Employers almost always claim performance issues as an excuse. Your attorney will use your past positive performance reviews, lack of prior write-ups, and the suspicious timing of the firing to prove the "poor performance" claim is just a cover-up.
Does this apply to stock options and restricted stock units (RSUs)?
Yes. Firing an employee immediately before a major cliff vesting date for stock options can be considered a breach of the implied covenant of good faith and fair dealing.
Can I be forced to pay my employer's legal fees if I lose?
Alaska uses a "loser pays" rule for attorney fees in some civil cases. However, employment laws often have protections for workers bringing good-faith wage claims. Always discuss the risks with your attorney before filing a lawsuit.
No reviews yet. Be the first to share your experience!