As per the amendment we have to pay statutory bonus Rs.7000 or minimum wage whichever is higher.
Kindly guide me the basis to comply the statutory requirement and at the same time it should not have financial burden on the company.
Your reply in this regard is highly appreciable...
Kind Regards,
Bhaskar
From India, Hyderabad
1Kindly guide me the basis to comply the statutory requirement and at the same time it should not have financial burden on the company.
Your reply in this regard is highly appreciable...
Kind Regards,
Bhaskar
From India, Hyderabad
Dear Bhaskar,
It will surely put burden on the company if till now your company was paying bonus as per 3500/- . you cant do anything but to comply with the notification. There is a way that if till now you were paying bonus @ 20% you can reduce it to 8.33%. But, for that you need to take advice of seniors as there are many other aspects involve like unions, Agreement, past bonus records, etc.
From India, Pune
It will surely put burden on the company if till now your company was paying bonus as per 3500/- . you cant do anything but to comply with the notification. There is a way that if till now you were paying bonus @ 20% you can reduce it to 8.33%. But, for that you need to take advice of seniors as there are many other aspects involve like unions, Agreement, past bonus records, etc.
From India, Pune
Dear Bhasker,
The answer you expect is that you should have the cake and eat it too. How is it possible? Whatever the rate of bonus your company is hitherto paying, if you calculate it as per the latest amendment carried out to sec.12 of the Payment of Bonus Act with retrospective effect from 01-04-2014, the employees will stand to get more amount of bonus and the employer has to bear a higher financial burden irrespective of the rate of bonus. Since the upward revision of the salary limit of Rs.10000/= to Rs.21000/= p.m and that of the notional salary limit of Rs.3500/= to Rs.7000/= p.m, the consequences are: (i) those employees in the salary range of Rs.10000/= to 20999/= will also become eligible for bonus as a result of which the no. of employees entitled for bonus stands increased (ii) the actual amount of bonus payable on notional salary is doubled and (iii) the retrospective effect of the amendment provides for arrears of bonus. Therefore, it is impossible to reduce the additional financial burden by correcting the past. Only possible thing is that you can convince the workmen and their unions during the future bonus negotiations to be satisfied with a lesser percentage of bonus that will not be less than the actual amount of bonus received by them in the previous years.
From India, Salem
The answer you expect is that you should have the cake and eat it too. How is it possible? Whatever the rate of bonus your company is hitherto paying, if you calculate it as per the latest amendment carried out to sec.12 of the Payment of Bonus Act with retrospective effect from 01-04-2014, the employees will stand to get more amount of bonus and the employer has to bear a higher financial burden irrespective of the rate of bonus. Since the upward revision of the salary limit of Rs.10000/= to Rs.21000/= p.m and that of the notional salary limit of Rs.3500/= to Rs.7000/= p.m, the consequences are: (i) those employees in the salary range of Rs.10000/= to 20999/= will also become eligible for bonus as a result of which the no. of employees entitled for bonus stands increased (ii) the actual amount of bonus payable on notional salary is doubled and (iii) the retrospective effect of the amendment provides for arrears of bonus. Therefore, it is impossible to reduce the additional financial burden by correcting the past. Only possible thing is that you can convince the workmen and their unions during the future bonus negotiations to be satisfied with a lesser percentage of bonus that will not be less than the actual amount of bonus received by them in the previous years.
From India, Salem
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Amendment to Payment of Bonus Act 2015.jpg
Bigger bonuses for more as Lok Sabha amends Payment of Bonus Act - The Economic Times.pdf
THE PAYMENT OF BONUS ACT.doc