I am working as hr executive in a garment manufacturing company. we have around 300 workers on daily wages basis & the company is paying them once in a fifteen days. But in a payslips they show the 15 days wages as follows. the company has fixed the monthly basic as 6600/-
for example the employee earns 4120 they break this amount as
OT Hrs 8
OT amount:- 508
Deduction Esi:- 68
Bonus advance:- 146
leave encashment :- 165
total :- 4119.00
Now i have queries 1. can we show the daily wages employee like this.
2. company is not paying anything as bonus & leave encashment they are just manipulating the figures. is it legal.
3. the same they are doing for the piece rated workers .
4. can we pay the bonus on monthly basis as they are showing. because bonus as far as i know is calculated on allocable surplus with company at the
end of the financial year after adjusting set on & set off amounts.
please help me with the proper way of calculating the amount for ESI & PF for the daily wages & pc Rated workers.
From India, Delhi
Few garments industries are still following the daily wages concept because of less orders. Garment industries are divided by two. One is compliance factory and second is non compliance factory. Compliance factory means they will have all proper document / system in place to get the orders. Non compliance factories will not have any proper documents and they act as sub-contracting factories to Tier 1 vendors/supplier. To your questions
1. yes you can show for 15 days but you need to have a monthly consolicated one for your reference.
2. It is illegal if you are not providing bonus/EL encashment. For bonus what ever you have said is right. EL encashment is like more than 30 days of balance has to be encashed.
3. Piece work employees - the same clause applicable for
4. Younare right about bonus
5. For PF & ESI: ESI has be calculated with all earning except Bonus and Leave encashment and PF is based on your salary breakup (Basic+DA+allowance+OT) execept 20% of HRA.
anishsheikhDear sir, Thanks for your valuable reply. our factory is a compliance factory. i am still not clear about the bonus. Can we pay bonus on monthly basis.
From India, Delhi
The law says "The bonus should be paid in cash within 8 months from the close of the accounting year or within one month from the date of enforcement of the award or coming into operation of a settlement following an industrial dispute regarding payment of bonus. However if there is sufficient cause extension may be applied for"
According to this bonus under this act, it cannot be paid on a monthly basis. Apart from this bonus like attendance bonus etc can be paid on a monthly basis.