NAV' A mutual fund’s price per share or exchange-traded fund’s (ETF) per-
From India, Delhi
Case 1 - If Employees basic Rs.4000 and Gross Rs. 7000. Bonus will be calculated on Rs. 4000 or Rs. 7000 ?

Bonus will be calculated on Rs 4000

Case 2 - If employees basic Rs.5600 and Gross Rs.11000. Bonus will be calculated on Rs. 5600 or 7000 ?

Bonus will be calculated on Rs 5600

Case 3 - If employee basic Rs. 6995 and Gross Rs. 13600 . Bonus will be calculated on Rs. 6995 or Rs 7000 ?

Bonus will be calculated on Rs 6995

Case 4 - If employee basic Rs. 11800 and Gross Rs. 21000 . Whether this employee come under purview of bonus act ?

He will come under the Payment of Bonus Act. (because for calculation of bonus if we have taken only Basic salary, the same basic salary alone would qualify for deciding the eligibility of an employee to get bonus)

Case 5 - If employee basic Rs. 12000 and Gross Rs. 21200. whether this employee come under purview of bonus act ?

Same as above Case 4

Case 6 - If employee basic Rs. 21000 and Gross Rs. 32000. whether this employee come under bonus act or not . if yes what amount bonus will be calculated ?

He will come under the cover of Bonus Act because his basic salary is not more than Rs 21000. As per Payment of Bonus Act an employee means any person employed on wages not exceeding Rs 21000. Therefore, if his basic salalry is 21001, then he will be out of the Bonus coverage.

In the case of an employee whose salary is more than 7000, say Rs 12000, his bonus will be calculated as if his salary is only Rs 7000. At the same time, if he is employed in an industry for which minimum wages has been notified by the government, then that statutory wage will be considered for deciding the bonus qualifying salary. Accordingly, if the notified minimum wages is more than 7000, then that will be taken as bonus qualifying salary. Following the same example, if the minimum wages is Rs 9000, then that wages will be the base for bonus calculation. Obviously, if the minimum wages is less than 7000, say, 6800, but the actual basic wages is 12000, then the bonus will be calculated considering that his wages is Rs 7000 only.


From India, Kannur
hi all
i have a query in this whole concept on the calculation of wages as the definition of wages as defined under the Bonus Act says " salary or wage” means all remuneration (other than remuneration in
respect of over-time work) capable of being expressed in terms of money,
which would, if the terms of employment, express or implied, were
fulfilled, be payable to an employee in respect of his employment or of
work done in such employment and includes dearness allowance (that is
to say, all cash payments, by whatever name called, paid to an employee
on account of a rise in the cost of living), but does not include—
(i) any other allowance which the employee is for the time being entitled
(ii) the value of any house accommodation or of supply of light, water,
medical attendance or other amenity or of any service or of any
concessional supply of foodgrains or other articles;
(iii) any travelling concession;
(iv) any bonus (including incentive, production and attendance bonus);
(v) any contribution paid or payable by the employer to any pension fund
or provident fund or for the benefit of the employee under any law for
the time being in force;
(vi) any retrenchment compensation or any gratuity or other retirement
benefit payable to the employee or any ex gratia payment made to
(vii) any commission payable to the employee.

As per this in a private company there are heads which complete a gross salary like basic, hra, conveyance allowance , education allowance , hostel allowance and special allowance. please clarify how do we need to calculate then ,

From India, Delhi
Wages/ salary means basic salary and dearness allowance. HRA is also a part of salary if the same is paid as per agreement or settlement. In private establishments, there has been a practice of fixing a lump sum amount as salary and then divide it into small particles under different heads, like Basic, HRA, Conveyance, etc etc. In such situation the sum total is the amount of remuneration agreed and that will qualify for bonus.
In a structured pay scale, there will be a basic pay scale and all other allowances will be fixed or even variable according to grades. In such situation, the allowances other than dearness allowance will qualify for bonus. This is the treatment with regard to lay off compensation, gratuity, retrenchment compensation or wherever reference as to wages are made.

From India, Kannur
Thanks Madhu for the response , this means that we will calculate the Bonus on the gross as we declare all the components of the salary in the appointment letter. Only have to leave the PF .Also please clarify if the HRA is also to be included as in all other compliances like PF it is not included.
From India, Delhi
If HRA is a part of salary then it should also be considered. As already pointed out, under normal circumstances only Basic salary and DA will qualify for Bonus. If these are considered for calculation of bonus, then only these two components should be considered for deciding whether an employee is eligible for bonus or not. Therefore, if you pay bonus only on Basic (+ DA, if any) then an employee whose basic (+DA) salary is not more than 21000 will be entitled to bonus even though his gross salary is more than 21000. At the same time, if you give bonus on a salary which includes basic, HRA etc then for deciding eligibility also you can include all these components.

From India, Kannur
Dear All
Kindly find the below Bonus Amendment it has mentioned that 7000 or mini wages whichever is higher not less
1. (1) This Act may be called the Payment of Bonus (Amendment) Act, 2015.
(2) It shall be deemed to have come into force on the 1st day of April, 2014.
2. In section 2 of the Payment of Bonus Act, 1965 (hereinafter referred to as the
principal Act), in clause (13), for the words ten thousand rupees, the words twenty-one
thousand rupees shall be substituted.
(i) for the words three thousand and five hundred rupees at both the places
where they occur, the words seven thousand rupees or the minimum wage for the
scheduled employment, as fixed by the appropriate Government, whichever is higher
shall respectively be substituted;

From India, Mumbai
Dear All
Kindly let us know the below Bonus Working is correct or incorrect:
Sr. No. Case Bonus Calculation Amt
1 If Gross Salary is Less than 7000 or 10000 (Mini Wages) 7000
2 If Gross Salary is More than 7000 & Less than 10000 (Min Wages) Mini Wages
3 If Gross Salary is More than 10000 (Mini Wages) Mini Wages
Thanks & Regards

From India, Mumbai
1. If minimum wages (basic+da) is rs.333/- per day and present is full month 26 days then wages will come =8658/- so bonus will be calculate on 8658/
2. If absenteeism in certain month, 24 working days then wages will come rs.7992/- .
On that time bonus will calculate on rs. 7992/- or rs. 7000/-.
3.if absenteeism in certain month, 12 working days then wages will come rs.3996/- .
On that time bonus will calculate on rs. 3996/- or rs. 7000/-.
Please clarify.

From India, Kolkata
Bonus is to be calculated on the wages earned. Therefore, if anybody has been on leave without pay and therefore, earned less than what is the normal wages per month, he should get less bonus only. Very simple, calculate the bonus according to what you have paid.

From India, Kannur

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