Hello Everyone,
I have joined as HR Executive recently. One employee has joined in August 2016. His salary is 12k(10k+2k). 2k is variables. That he will get after completion of his probation. Will he eligible for bonus? If yes, how much and When?? On this Diwali ? I don't know when my company is giving bonus? I have no idea about bonus. So please someone help me. If I have asked a silly question then please suggest me. Thanks in advance.

From India, Cuttack
Hello Gaytri,
Accept my congratulations on your being joining as HR executive.
First you need to examine as to whether the establishment is covered under Act.(Refer to Section 1(3) of the Act.
Refer to Section 2(13) of the Act clearly debar an apprentice engaged under the Apprentices Act, 1961 and not a trainee.
Refer to Section 16 of the Act, which gives relaxation to the newly set up establishments, if they don't make profit, from paying bonus to their employees.
The calculation of bonus is made on the basis of each accounting year and bonus is payable within eight months of close of the accounting year.( Refer Section 19).
My sincere advise to you is please go through the Payment of Bonus Act, 1965 or the citehr site where such queries have been answered many times for more clarity.
BS Kalsi
Member Since August, 2011

From India, Mumbai
As per the payment of bonus act, bonus is payable eight months after the end of the financial year. Your employee has joined this year. So he will be included in the bonus payment in the next year.
From India, Mumbai

Good Morning..Thank you all. I got it. Another query is how much will he get? How will i calculate? His basic is 5500. Please someone calculate it for me.. Thanks in advance.. Regards, Mama
From India, Cuttack
Member BS Kalsi’s explanation is Crystal Clear. I think Ms.Gayatri’s query is answered well. Congrats to Gayatri
From India, Thane
Bonus Act is applicable to establishments engaging 20 or more persons. If in the first 5 years the establishment has made losses, it need not pay bonus. If it has made profits the % of bonus has to be calculated as provided in the act.
Now you mention that his basic is 5500. You have to check minimum wages for your area in case bonus % works out to 8.33%. The quantum of bonus should be 7000 or the minimum wages declared from time to time, whichever is higher. Phew!

From India, Mumbai
Shrikant, your analysis is wrong
The bonus will be on actual wages, subject to a wage ceiling of Rs. 7000 or minimum wages, whichever higher. That is the ceiling on the wages, not the minimum bonus.
In this case, the wages is less than Rs. 7000 so the bonus will be based on actual wages drawn.

From India, Mumbai
Dear Mr Banerjee,
your submission is true and correct to the extent that the bonus is calculated on actual wages earned during a financial year.
Keeping in view of the latest amendment replacing "Rs.3500/-" by "Rs.7000/- or minimum wages which is higher", your view "that if wages is less than Rs. 7000 so the bonus will be based on actual wages drawn." is not within the sense of amendment.
P K Sharma

From India, Delhi
I agree with the views expressed by Sh Saswata Banerjee that an employee shall be eligible to the draw payment of bonus on the ACTUAL salary or wages drawn by him if his salary is less than Rs 7000/-.
BS Kalsi,
Member since August, 2011

From India, Mumbai
Dear Members,
I disagree with Mr.Saswatabanerjee.
The new Amendment is protecting the worker to the minimum Bonus of Rs.7000/- whether his salary is less or equal to 7000.
The previous amount of Rs.3500/- as min.bonus is raised to Rs.7000/-. Again, earlier, the bonus was not linked to the min. wages.
The Act says " Min.Bonus is Rs. 7000 or 8.33% of Min.Wages paid, "" whichever is higher ""
Here the the words " whichever is higher" has the significance. It seems many are not giving importance to these words.
If the company is willing, they can pay upto 20% of the min. wages also; but the work force cannot demand more than 20% as bonus.
Hope it is clear.

From India, Thane

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