This is from my post on Oct 18th, please go through and refer to the act also.
Quoted :
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I think it is important for members to read the bonus act and understand it properly, so as not to pass wrong information the the readers on this forum.
Sec 10 defines minimum bonus :
Payment of minimum bonus.- Subject to the other provisions of this Act, every employer shall be bound to pay to every employee in respect of the accounting year commencing on any day in the year 1979 and in respect of every subsequent accounting year, a minimum bonus which shall be 8.33 per cent. of the salary or wage earned by the employee during the accounting year or one hundred rupees, whichever is higher, whether or not the employer has any allocable surplus in the accounting year.
so, its 8.33% of salary or wages.
Sec 12 talks of bonus for certain employees :
Calculation of bonus with respect to certain employees.- Where the salary or wage of an employee exceeds 3*[two thousand and five hundred rupees] per mensem, the bonus payable to such employee under section 10 or, as the case may be, under section 11, shall be calculated as if his salary or wage were 3*[two thousand and five hundred rupees] per mensem.]
This limit of Rs. 2,500 was increased to Rs. 2,500 and now increased to "Rs. 7,000 or minimum wages, whichever higher"
so, an employee gets bonus (min bonus) at 8.33% of his actual wages (which is defined as basic + DA) and if his salary or wages is more than Rs. 7,000 then the bonus will be computed as if his salary is Rs. 7,500.
If the company has made more profit and money is available in allocable surplus account (working provided in Sec 5), then the bonus will be higher, subject to a maximum of 20% of salary or wages. And again, if someone's salary or wages is more then Rs. 7,000 then he gets 20% of the ceiling (20% of Rs. 7,000 X 12 months)
Rs. 7,000 is not the minimum bonus, it is not necessary for the company to pay Rs. 7,000 as bonus to someone whose basic and da is less than Rs. 7,000 per month.
Saswata Banerjee
Progress Partners, Mumbai
Twitter : @sasmumbai
From India, Mumbai
2358Quoted :
**********
I think it is important for members to read the bonus act and understand it properly, so as not to pass wrong information the the readers on this forum.
Sec 10 defines minimum bonus :
Payment of minimum bonus.- Subject to the other provisions of this Act, every employer shall be bound to pay to every employee in respect of the accounting year commencing on any day in the year 1979 and in respect of every subsequent accounting year, a minimum bonus which shall be 8.33 per cent. of the salary or wage earned by the employee during the accounting year or one hundred rupees, whichever is higher, whether or not the employer has any allocable surplus in the accounting year.
so, its 8.33% of salary or wages.
Sec 12 talks of bonus for certain employees :
Calculation of bonus with respect to certain employees.- Where the salary or wage of an employee exceeds 3*[two thousand and five hundred rupees] per mensem, the bonus payable to such employee under section 10 or, as the case may be, under section 11, shall be calculated as if his salary or wage were 3*[two thousand and five hundred rupees] per mensem.]
This limit of Rs. 2,500 was increased to Rs. 2,500 and now increased to "Rs. 7,000 or minimum wages, whichever higher"
so, an employee gets bonus (min bonus) at 8.33% of his actual wages (which is defined as basic + DA) and if his salary or wages is more than Rs. 7,000 then the bonus will be computed as if his salary is Rs. 7,500.
If the company has made more profit and money is available in allocable surplus account (working provided in Sec 5), then the bonus will be higher, subject to a maximum of 20% of salary or wages. And again, if someone's salary or wages is more then Rs. 7,000 then he gets 20% of the ceiling (20% of Rs. 7,000 X 12 months)
Rs. 7,000 is not the minimum bonus, it is not necessary for the company to pay Rs. 7,000 as bonus to someone whose basic and da is less than Rs. 7,000 per month.
Saswata Banerjee
Progress Partners, Mumbai
Twitter : @sasmumbai
From India, Mumbai
Have you all read definition of wages under the payment of bonus act? first read it and then post your comments.
From India, Mumbai
From India, Mumbai
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THE PAYMENT OF BONUS ACT.doc