Educator, Management Consultant & Trainer
Basically payment of bonus does not depend upon wish of any individual as how much to pay.
minimum bonus is 8.33% and Maximum is 20% but depend upon allocable surplus,set ON/Set off.
it means if you have reasonable profits and you have set On available with you than you are bound to pay bonus as per set on amount available with you.
26th March 2016 From India, Delhi
you want to pay 8.33% bonus instead of 20% to whom..? to you staff category employees or workers...!
In case of workers category, Yes you can pay 8.33%, on upon allocable surplus set-on / set-off provision
But in case of staff category employees, bonus is part of there CTC if you are planing to revise bonus percentage the rest of the amount you have to adjust in some allowances (salary component) and it may cause to increase employees monthly gross salary also may increase esic contribution burden from both the side employer as well as employees.
Please refer note on latest amendment in The Payment of Bonus Act, 1965 it may help you to clear your concept
Amendment in The Payment of Bonus Act, 1965.
This is to inform you that both the Houses of the Parliament have passed the Payment of Bonus Act amendment Bill yesterday. As per the news broadcasted on Radio, the said bill has been passed with retrospective effect i.e. from financial year 2014-2015.
Prior to the said amendment, the employee was defined under section 2(13) which reads as under:
“employee means any person (other than an apprentice) employed on salary or wages not exceeding Rs.10,000/- per month in any industry to do any skill, manual, supervisory, managerial, administrative, technical or clerical work for higher or reward whether the terms of employment be expressed or implied”.
As per the amendment the salary/wage limit of Rs.10,000/- has been enhanced to Rs. 21,000/- per month. The nett financial impact of the same will be that those employees who are drawing salary/wages not more than Rs.21,000/- per month and those who are working in skill, manual, supervisory, managerial, administrative, technical or clerical work, will also be entitled to receive bonus henceforth.
Prior to this amendment as per section 12 where the salary/wages of an eligible employee exceeds Rs.3500/- per month (Rupees Three Thousand Five Hundred Only) the bonus payable to such employee under this act i.e. minimum @ 8.33% or maximum @20% as the case may be, was calculated as if salary or wages or such an employee was Rs.3500/- (Rupees Three Thousand Five Hundred Only).
In the aforesaid amendment the figure of Rs.3500/- (Rupees Three Thousand Five Hundred Only) has been increased to Rs.7,000/- (Rupees Seven Thousand Only) per month. Prior to the amendment the eligible employee was entitled to receive minimum bonus of Rs.3500/- per annum @ 8.33% and a maximum bonus of Rs.8400 (Rupees Eight Thousand Four Hundred Only) @ 20% as the case may be. Now the employer will have to pay minimum bonus of Rs.7,000 per annum @8.33% instead of Rs.3500 per annum and maximum bonus of Rs.16,800/- @20% instead of Rs.8,400/- per annum.
Since the amendment is with retrospective effect, for the financial year 2014-2015, the employer will have to pay difference between Rs.3500 and Rs.7000 per annum, in case the employer has paid minimum bonus @8.33% during the said financial year and in case if the employer has paid maximum bonus of Rs.8400 @20% during the said financial year, such a employer will have to pay the difference between Rs.8400 and Rs.16800/-. In all other cases the employer has to pay the proportionate difference, as may be the case.
In addition this, the employer will have to pay the bonus to those employees whose salary i.e. basic + DA was more than Rs.10,000 but less than Rs. 21,000/- per month during the said financial year 2014-2015.
Dy. Manager HR.
26th March 2016 From India, Mumbai
Bonus is payable in accordance with the provisions and methods for computation of allocable / available surplus. please go through the provision, understand aims and procedure and arrive at practically amount to be paid as bonus. No one can give a legally true and correct answer to you like this.If you are referring new notification and trying to put forth that in view of notification came on 31st Dec.2015, there is more burden and you wish to compare and stay nearer to that figure .Less burden, more burden is not HR .Say what is law saying with confidence.The right answer can be amount which you find. So, you calculate as per schedule 2(a) of Bonus Act, and arrive the amount available , same amount and %age is legally payable for bonus.The issue has been already clarified by our other eminent personalities, which you can visit in academic interest.
Labour Law Adviser
Director-Future Instt.of Engg and Mnmnt Technology
27th March 2016 From India, Delhi