Hello,
I am answering four querries in this post. I will have to therefore answer each querry by name. Kindly bear with me.
First for "sangsangeet"
CTC must be regarded only as a management budgetting tool. If you use for salary negotiations, you have to ensure that that each element included is in fact paid out OR it is clearly informed that though included, some inclusions will not be paid. Even if you that only the finite ingredients may be included in CTC. Bonus is NOT a finite ingredient except at the Minimum (8.33%) and the Maximum (20%) But Bonus as Bonus under the act is paid only to those covered by the act (and others, if the management so decides-will get only ex-gratia which is an amount always equal to the bonus paid to covered employees. No, Bonus should NOT be included in CTC.
Next, there is no provision in the Payment of Bonus Act to pay Bonus in instalments. (Even if you do, it will be termed as "advance against bonus" and will have to be reconciled and appropriated at the end of the financial year when the Bonus under the act is calculated and declared. Also how and on what basis, will you even estrimate the amount of advance to be paid. My advice is banish the thought. Stick to paying Bonus to eligible employees at the end of the year.
Lastly, even if an "advance against bonus" is paid in monthly instalments, it will atract ESI, as it is NOT bonus (when paid) and any payment made to the employee at a frequency of less than two months attracts ESI!!!
Now for "aru 729"
Your observation is correct. I had covered in my earlier reply but it was explicitly done!
For "banditapadhi"
In brief:
- Bonus is paid to eligible (covered employees)
- As at present, any employee who draws salary/wage (Basic+DA) less than Rs. 10000/- per month is eligible to receive bonus under the act.
- For those employees who draw salary/wage (Baisc+DA) less than Rs. 3500/- will receive the bonus declared under the act on his actual salary/wage(Basic+DA)
- For those who draw salary/wage greater than Rs. 3500/- per month but less than Rs. 10000/- per month will receive bonus as though their salary/wage (Basic+DA) is only Rs. 3500/- per month.
- The recent amendment to Payment of Bonus Act has enhanced the eligibility to receive bonus considerably. (i.e. from Rs. 3500/- to Rs. 10000/-) and the eligiblity to receive Bonus under the act marginally. (i.e. from Rs. 2500/- per month to Rs. 3500/- per month.)
I suppose this should set at rest your doubt.
Lastly for "s. Ramchandran"
No you understanding is NOT right. This mail and particularly this reply will make the point clear.
That is about all ladies & gentlemen (for the time being at least)
Regards
samvedan
September 25, 2008
---------------------------------------