Dear friends, Is BONUS necessary to pay every year as per Industrial law? I know that minimum bonus rate is 8.33% and maximum bonus rate is 20%. Is it correct? Please suggest. Thanks & Regards, Aazad
From India, Vijayawada
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1From India, Vijayawada
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Dear Friends,
I have been working for a small IT company since March 2009. I was informed that there is no bonus in our organization. I discussed this with the director and was told that the company has not been paying any bonus since its inception. Our organization was established on 21st June 2006, so it has just completed 3 years.
Is it mandatory for IT industries to provide bonus payments?
Thank you in advance for your valuable responses.
Cheers,
Jeeva
From India, Bangalore
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I have been working for a small IT company since March 2009. I was informed that there is no bonus in our organization. I discussed this with the director and was told that the company has not been paying any bonus since its inception. Our organization was established on 21st June 2006, so it has just completed 3 years.
Is it mandatory for IT industries to provide bonus payments?
Thank you in advance for your valuable responses.
Cheers,
Jeeva
From India, Bangalore
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Dear all, can anyone send the bonus act detail, because in most of the small firms the same situation is happening..
From India, Madras
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From India, Madras
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Hi,
Bonus is mandatory under the Payment of Bonus Act. It is payable to employees whose salary is less than Rs. 10,000 per month and is payable minimum 8.33% and maximum 20%, depending upon the allocable and available surplus. The limit of salary for the calculation of bonus is Rs. 3,500. The bonus can be set on and set off as per the act. If there is a loss to the company, then the amount of bonus is to be set on for the next five years, and vice versa. The bonus is payable in the first five years only for the years in which the company has earned a profit.
Regards,
Rajendra Bhavsar
09850869517
From India, Mumbai
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Bonus is mandatory under the Payment of Bonus Act. It is payable to employees whose salary is less than Rs. 10,000 per month and is payable minimum 8.33% and maximum 20%, depending upon the allocable and available surplus. The limit of salary for the calculation of bonus is Rs. 3,500. The bonus can be set on and set off as per the act. If there is a loss to the company, then the amount of bonus is to be set on for the next five years, and vice versa. The bonus is payable in the first five years only for the years in which the company has earned a profit.
Regards,
Rajendra Bhavsar
09850869517
From India, Mumbai
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Dear,
According to the Bonus Act, it is applicable to firms that have completed five years. In other words, the bonus is not applicable for the first five years of a firm. Seniors, please tell me if I am wrong.
Thanks
Regards,
Gahelot
From India, Delhi
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According to the Bonus Act, it is applicable to firms that have completed five years. In other words, the bonus is not applicable for the first five years of a firm. Seniors, please tell me if I am wrong.
Thanks
Regards,
Gahelot
From India, Delhi
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Dear Azzad,
As per the provisions of the Bonus Act, every industry/factory has to pay the bonus for the accounting year to their employees. Industries/factories started within five years are exempt from paying bonus, but during any year if they earn/show a profit, they have to pay a bonus between 8.33% to 20%. It is payable to employees whose salary is less than Rs. 10,000/- per month and is payable at a minimum of 8.33% and a maximum of 20% depending upon the allocable and available surplus. The ceiling of the bonus is also extended to Rs. 3,500/- per month.
Regards,
R. Palaniswamy
From India, Coimbatore
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As per the provisions of the Bonus Act, every industry/factory has to pay the bonus for the accounting year to their employees. Industries/factories started within five years are exempt from paying bonus, but during any year if they earn/show a profit, they have to pay a bonus between 8.33% to 20%. It is payable to employees whose salary is less than Rs. 10,000/- per month and is payable at a minimum of 8.33% and a maximum of 20% depending upon the allocable and available surplus. The ceiling of the bonus is also extended to Rs. 3,500/- per month.
Regards,
R. Palaniswamy
From India, Coimbatore
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We know that as per the Bonus Act, an employee whose salary is up to Rs. 10,000/- is entitled to a bonus. However, the other important point is that the salary limit for bonus calculation is Rs. 3500/-. What does this mean? If a worker's salary is Rs. 7000/-, should we calculate the bonus at 8.33% to 20% based on his actual salary of Rs. 7000/- or the capped amount of Rs. 3500/- as per the Bonus Act? Please advise.
With Regards,
Ashok
From India, Gurgaon
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With Regards,
Ashok
From India, Gurgaon
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Hi Mr. Aazad,
As per the Bonus Act of 1965:
1. The payment of bonus is applicable to all establishments employing 20 or more workmen.
2. You are correct that the minimum percentage of bonus is 8.33%, but there is a ceiling limit of Rs. 3500.00. Therefore, when calculating the bonus on the salary at 8.33%, if the amount exceeds Rs. 3500, only Rs. 3500.00 can be paid as per the act, i.e., the minimum bonus.
3. If the employer is not miserly, they can pay 8.33% of the salary/wage even if it exceeds Rs. 3500.00.
4. If the employer is still open-minded and the company is making substantial profits, they can opt to pay a bonus of up to 20% of the salary. This payment is accepted by the Income Tax department.
5. The minimum bonus is Rs. 100.00 or more.
6. An employee must work for at least 30 days to be eligible for the minimum bonus of Rs. 100.00 or more, calculated based on the salary earned during the 30-day period, whichever is higher.
7. All employees have a statutory right to share in the profits of the employer as per the Act.
8. The company must have completed 5 years from the date of commencing establishment operations to make bonus payments to its employees.
Mohan Rao
Manager HR
From India, Visakhapatnam
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As per the Bonus Act of 1965:
1. The payment of bonus is applicable to all establishments employing 20 or more workmen.
2. You are correct that the minimum percentage of bonus is 8.33%, but there is a ceiling limit of Rs. 3500.00. Therefore, when calculating the bonus on the salary at 8.33%, if the amount exceeds Rs. 3500, only Rs. 3500.00 can be paid as per the act, i.e., the minimum bonus.
3. If the employer is not miserly, they can pay 8.33% of the salary/wage even if it exceeds Rs. 3500.00.
4. If the employer is still open-minded and the company is making substantial profits, they can opt to pay a bonus of up to 20% of the salary. This payment is accepted by the Income Tax department.
5. The minimum bonus is Rs. 100.00 or more.
6. An employee must work for at least 30 days to be eligible for the minimum bonus of Rs. 100.00 or more, calculated based on the salary earned during the 30-day period, whichever is higher.
7. All employees have a statutory right to share in the profits of the employer as per the Act.
8. The company must have completed 5 years from the date of commencing establishment operations to make bonus payments to its employees.
Mohan Rao
Manager HR
From India, Visakhapatnam
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Hi, Mr. Aazad,
As per the Bonus Act 1965 and Amendment 2006:
1. The payment of bonus is applicable to all establishments employing 20 or more workmen.
2. You are right, the minimum percentage of bonus is 8.33, but there is a ceiling limit of Rs. 3500.00 (bonus calculation for those employees who were receiving a basic salary of Rs. 10000.00 per month). So, calculating the bonus on the salary at 8.33%, if the amount exceeds Rs. 3500, you can only pay Rs. 3500.00 as per the act, i.e., the minimum bonus.
3. If the employer is still open-minded and the company is making more profits, they can opt for a bonus payment of up to 20% of the salary. This payment is accepted by the Income Tax department.
4. The minimum bonus is Rs. 100.00 or more.
5. The employee must work for a minimum of 30 days to be eligible for the minimum bonus, i.e., Rs. 100.00 or more, calculated based on the salary earned over a 30-day period, whichever is higher.
6. All employees have a statutory right to share in the profits of the employer as per the said Act.
7. The company must complete 5 years from the date of commencing establishment operations to make bonus payments to its employees.
G. J. Panchal
Manager Personnel & Admin
From India, Ahmadabad
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As per the Bonus Act 1965 and Amendment 2006:
1. The payment of bonus is applicable to all establishments employing 20 or more workmen.
2. You are right, the minimum percentage of bonus is 8.33, but there is a ceiling limit of Rs. 3500.00 (bonus calculation for those employees who were receiving a basic salary of Rs. 10000.00 per month). So, calculating the bonus on the salary at 8.33%, if the amount exceeds Rs. 3500, you can only pay Rs. 3500.00 as per the act, i.e., the minimum bonus.
3. If the employer is still open-minded and the company is making more profits, they can opt for a bonus payment of up to 20% of the salary. This payment is accepted by the Income Tax department.
4. The minimum bonus is Rs. 100.00 or more.
5. The employee must work for a minimum of 30 days to be eligible for the minimum bonus, i.e., Rs. 100.00 or more, calculated based on the salary earned over a 30-day period, whichever is higher.
6. All employees have a statutory right to share in the profits of the employer as per the said Act.
7. The company must complete 5 years from the date of commencing establishment operations to make bonus payments to its employees.
G. J. Panchal
Manager Personnel & Admin
From India, Ahmadabad
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Dear Sir,
I have been working with a public sector company since December 2007. Our company was registered in September 2006, and I was informed that there is no bonus in our organization. I discussed this matter with my Senior Manager. However, he informed me that as per the Payment of Bonus Act 1965, we are not eligible for a bonus this year.
According to the rules, "In the first five accounting years following the accounting year in which the employer sells the goods produced or manufactured by him or renders services, as the case may be, from such establishment, bonus shall be payable only in respect of the accounting year in which the employer derives profit from such establishment. Such bonus shall be calculated in accordance with the provisions of this Act in relation to that year, but without applying the provisions of section 15."
Thank you,
P. Kumar
From India, Delhi
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I have been working with a public sector company since December 2007. Our company was registered in September 2006, and I was informed that there is no bonus in our organization. I discussed this matter with my Senior Manager. However, he informed me that as per the Payment of Bonus Act 1965, we are not eligible for a bonus this year.
According to the rules, "In the first five accounting years following the accounting year in which the employer sells the goods produced or manufactured by him or renders services, as the case may be, from such establishment, bonus shall be payable only in respect of the accounting year in which the employer derives profit from such establishment. Such bonus shall be calculated in accordance with the provisions of this Act in relation to that year, but without applying the provisions of section 15."
Thank you,
P. Kumar
From India, Delhi
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Hello Mr. Mohan Rao,
I worked in a recruitment firm for 10 years with 38 employees. I resigned from there on 21st September 2012. My salary there was Rs. 17,000/- in hand per month. Am I eligible for the Diwali bonus from this previous company of mine? Please advise whether I should go to the boss and ask for it or not?
Aishwarya
From India, Mumbai
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I worked in a recruitment firm for 10 years with 38 employees. I resigned from there on 21st September 2012. My salary there was Rs. 17,000/- in hand per month. Am I eligible for the Diwali bonus from this previous company of mine? Please advise whether I should go to the boss and ask for it or not?
Aishwarya
From India, Mumbai
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Hello,
I worked in a recruitment firm for 10 years with 38 employees. I resigned from there on 21st September 2012. My salary there was Rs. 17,000/- in hand per month. Am I eligible for the Diwali bonus from this previous company of mine? Please advise whether I should go to the boss and ask for it or not?
Aishwarya
From India, Mumbai
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I worked in a recruitment firm for 10 years with 38 employees. I resigned from there on 21st September 2012. My salary there was Rs. 17,000/- in hand per month. Am I eligible for the Diwali bonus from this previous company of mine? Please advise whether I should go to the boss and ask for it or not?
Aishwarya
From India, Mumbai
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What is meant by Allocatable surplus in Payable of Bonus Act-1965? R. Mondal HR Personnel CIAL, Durgapur, WB
From India
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From India
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Bonus Act 1965 Notification Inquiry
I heard that there is a recent notification (during 2011-2013) pertaining to the Bonus Act 1965, which states that even if a company suffers a loss in each of the first five years from the date of inception, the company is bound to pay the minimum bonus at 8.33% every year. Is this correct? If so, kindly forward a copy of the said notification.
Regards,
Santanu.
From India
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I heard that there is a recent notification (during 2011-2013) pertaining to the Bonus Act 1965, which states that even if a company suffers a loss in each of the first five years from the date of inception, the company is bound to pay the minimum bonus at 8.33% every year. Is this correct? If so, kindly forward a copy of the said notification.
Regards,
Santanu.
From India
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Dear Seniors would you please let me know about exgretia. in which condition we have to pay exgretia. kindly share his views
From India, Dehra Dun
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From India, Dehra Dun
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Dear All, If a Bonus is included as an employee’s CTC is it necessary for the company to pay out the bonus within five years of its establishment
From India, Pune
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From India, Pune
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