Lawsuit for Breach of An Oral Agreement to Pay Former Employee a Bonus

In Cron v. Hargro, 91 NY2d 362, 694 N.E.2d 56, 670 N.Y.S.2d 973 [1998], a former employee brought an action against his former employer for breach of an oral agreement to pay the employee a fixed salary plus a bonus equal to 20% of the employer's annual pretax profits. The employer moved to dismiss the complaint based on the Statute of Frauds alleging that the former employee's bonus had to be calculated after a passage of a year. The court held that, "when the employment relationship is terminable within a year and the measure of compensation has become fixed and earned during the same period, the sole obligation to calculate such compensation will not bring the contract within the one-year proscription of the Statue of Frauds" (Cron, at 370).