Bonus act amendment - all employees entitled to bonus monthly? - CiteHR
Amit Aishwary Choudhary
Managing People At Work.
Pulipaka_ramarao
Manager - Hr & Ir
Ssushr
Pune
Viru.Mhatre@ingeniousmanagement.com
Business Consultant - Ims

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Dear All, We have been informed by some officials from labour commission that Bonus has been made statutory to every employee and that bonus has to paid on a monthly basis as a part of salary. Even if the employee has left the organization more than 3 months back he is entitled for a bonus or even if the employee is less than 1 month old in the organization even he is entitled for a bonus?
Is this true? Are there any amendments to the bonus act? can someone guide us on this issue? is there a copy of latest act / amendments available?
Please help
Warm Regards
Viru Mhatre
Ingenious Management
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"Employee" means any persons (other than an apprentice) employed on a salary or wage not exceeding twenty-one thousand rupees per mensem in any industry to do any skilled or unskilled manual, supervisory, managerial, administrative, technical or clerical work for hire or reward, whether the terms of employment be express or implied.
# Eligibility for bonus
Every employee shall be entitled to be paid by his employer in an accounting year, bonus, in accordance with the provisions of this Act, provided he has worked in the establishment for not less than thirty working days in that year.
## Time-limit for payment of bonus -Sec-19
Bonus must be paid within a period of eight months from the close of the accounting year as per Income Tax i.e. April to March (i.e.on or before 30th November)
Regards,
Amit
Summary:
## Applicability of statutory bonus
-Applicable to all employees whose basic + DA ('eligible salary') less than Rs.21,000
-Minimum bonus payable is 8.33% of eligible salary and maximum bonus 20% of eligible salary
-If 8.33% of eligible salary exceeds Rs.7,000 per year, then the statutory bonus limited to Rs.7,000 or Rs.583 per month
-Statutory bonus payable on monthly also based on actual number of days worked, etc (excluding LOP's)
-Bonus may be paid on monthly basis, however employees cannot demand for monthly payment. Similarly employees are eligible for the proportionate bonus at the time of resignation / retirement / termination.
-The revised bonus limits as given above are applicable from 1 April 2014
-Every employee whose salary not exceeds Rs.21,000 per month eligible for statutory bonus
-Every category of employees, including skilled or unskilled, supervisory, managerial, administrative, technical or clerical works
-8.33% is the minimum bonus and the amount increases when the profit of the entity grows-up
-Maximum bonus payable to any employee, even if they are making good profits limit to 20% of eligible salary - Rs. 16,800 for the year or Rs. 1,400 per month
-If the statutory bonus payable is less than the minimum wages, then the entity need to pay atleast the amount equal to the minimum wages.
Thank You for your reply....very helpful
Warm Regards
Viru Mhatre
If it a scheduled employment under Minimum Wages Act then eligibility of minimum bonus will be Rs. 7000 or Minimum Wages whichever is higher.
Dear Sir,
Pl go through the contents as per Sec 2 (2) & 2 (11) of the payment of Bonus Act amended from 01.04.2014.
Mr.Amit has explained above for the same.
Regards,
V R RAO PULIPAKA
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