Madhu.T.K
Industrial Relations And Labour Laws
Nathrao
Insolvency N Gst Professional
Monika.gurdasani
Hr Cum Admin
+1 Other

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1. Is Notice pay calculated on basic salary or gross salary?
This company is manufacturer & supplier of ophthalmic instruments and devices based in Delhi.
There is nothing mention in letter of appointment about notice pay.
2. Is is mandatory to pay bonus to employee who has been terminated by the company on ground of misconduct for unacceptabale quality of work performance past few months.
Our company is paying one month gross salary as bonus on Diwali time.
Urgent please reply...

if he/she worked more than 30 days in any financial year company must pay bonus to him irrespective of seperation
Notice pay should be Gross Salary. This is for both the employer to terminate an employee and the employee to leave the employer. The former one is supported by the relevant provisions of ID Act also.
Payment of statutory bonus cannot be forfeited for such kind of misconduct whereas it is justifiable in the case of dismissal for some quantifiable loss caused to the company and as part of compensating the loss to the extend of bonus payable to the employee. Performance being something which is relative and relative to some targets set by you, it will always be influenced by some or other personal bias and judgments of the reporting officer. Therefore, in order to avoid complications, send him off by paying notice pay in gross and bonus at actual.

"Is is mandatory to pay bonus to employee who has been terminated by the company on ground of misconduct for unacceptable quality of work performance past few months"
Poor quality of work may be professional incompetence but not misconduct.
Poor quality of work can be due to various reasons.
Was his work earlier good?
Why only in last few months quality has deteriorated?
However in the bare facts given above non payment of bonus can raise issues which are best avoidable.
Extract from Bare Act
Section 9. Disqualification for bonus.- Notwithstanding anything contained in this Act, an employee shall be disqualified from receiving bonus under this Act, if he is dismissed from service for-
(a) fraud; or
(b) riotous or violent behavior while on the premises of the establishment; or
(c) theft, misappropriation or sabotage of any property of the establishment.
The present case does not fall in these circumstances, clauses.
Better pay the worker.

I agree to points renedered by Mr Nathrao and can be considerd for action.
Industrial Disputes Act doesn’t say about notice or notice pay calculation on resignation. It refers to payment of compensation for retrenchment which is gross pay.
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