Dear All,
Kindly suggest if an employee left the organisation. So, Is He/ She is eligible for Bonus or not.
Or if the company has mentioned in the Salary structure that bonus is based on performance based.
Kindly suggest
Aagam Ananad
From India, Chennai
3Kindly suggest if an employee left the organisation. So, Is He/ She is eligible for Bonus or not.
Or if the company has mentioned in the Salary structure that bonus is based on performance based.
Kindly suggest
Aagam Ananad
From India, Chennai
Dear Anand,
Whether the employee is eligible for bonus/not is dependent upon what the term "bonus" refers to in your company. Is it the normal "bonus" that is applicable as per the Payment of the Bonus Act, or is it a pure performance based incentive (termed as performance bonus/bonus by several companies) ?
Mandatory bonus, if applicable have to be paid out irrespective of when the employee has left the organization. And that can be on a proportionate basis. However, Performance based bonus (if that is what is mentioned in the salary structure/appointment contract-agreement) is applicable only after evaluation of the performance, and this evaluation is done during a specific period. If an employee is not present / in employment during that evaluation period, there is no question of the evaluation and hence no performance bonus. Ideally, you should always mention a note in your employment contract / Remuneration - Salary structure document that performance bonus is applicable only if the employee has neither resigned nor left the company before the date of declaration of the same.
Hope that clears your confusion.
Cheers, A.B.
From India, Mumbai
Whether the employee is eligible for bonus/not is dependent upon what the term "bonus" refers to in your company. Is it the normal "bonus" that is applicable as per the Payment of the Bonus Act, or is it a pure performance based incentive (termed as performance bonus/bonus by several companies) ?
Mandatory bonus, if applicable have to be paid out irrespective of when the employee has left the organization. And that can be on a proportionate basis. However, Performance based bonus (if that is what is mentioned in the salary structure/appointment contract-agreement) is applicable only after evaluation of the performance, and this evaluation is done during a specific period. If an employee is not present / in employment during that evaluation period, there is no question of the evaluation and hence no performance bonus. Ideally, you should always mention a note in your employment contract / Remuneration - Salary structure document that performance bonus is applicable only if the employee has neither resigned nor left the company before the date of declaration of the same.
Hope that clears your confusion.
Cheers, A.B.
From India, Mumbai
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Amendment to Payment of Bonus Act 2015.jpg
Bonus act amendment gazette copy.pdf
Bonus-amendment _206.doc