Understanding the 2010 Amendment to the Payment of Bonus Act: How Does It Affect You?

Enclosed is the Amendment for Payment of Bonus Act (2010). This can be of some help to members of Cite-HR.

Regards,
SanjogK
Shared Service Center - HR

Thank you, SanjogK. If someone is taking a salary of 20,000 per month as take-home pay, would they be eligible for a bonus? How would the calculation be done? Please guide.

Thank you,
Ajay

Advice Needed on Bonus Calculation

Please help me out by providing your advice regarding:

1. What does "Ceiling Bonus" mean, and what amount should I consider for calculation?
2. What is meant by "set on" and "set off"?
3. Do employees who joined on 16 March 09 and left on 15 April 10 have the right to claim a bonus?

Thanks and regards,
Devidas

Ceiling Bonus means if the salary is Rs. 10,000/-, then the bonus amount to be paid is Rs. 3,500/-, which is 8.33% of the maximum level to Rs. 3,500/-.

Set ON and Set Off are found after calculating from Form A and B.

Yes, the employee has the right to claim the bonus.

Regards,
Arihant

Dear Sanjok ji, The attached PDF is only a bill put up before Parliament. Please see it at the top of the title. Please attach a Gazette notification if you have one.

URGENT.

Regards, PBS KUMAR

Clarification

The attached document is a bill and not an act. The current status of the bill, whether it will be presented before Parliament or not, is unknown. Therefore, there is no need to take action on the bill until it becomes an act.

Regards,
Shyam Pandirkar

Employees who joined on 11 January 2010 and transferred to another department within the same company on 23 September 2010, do they have the rights to claim a bonus?

Thank you.

Dear Friends,

The post regarding the amendment proposal in the Bonus Act has created confusion among HR professionals. The attachment, as rightly said by one friend in his comments, is only a bill. It has to travel a long way before becoming an act and enforced legislation. People need not act on it. As of the current date, there have been no amendments in the act enforced so far.

Regards,
Anil Kaushik
Chief Editor, Business Manager - HR Magazine
B-138, Ambedkar Nagar, Alwar-301001
Mob: 09829133699
Email: bmalwar@yahoo.com

Dear Member,

Why not? If the employee is working with the same employer, then even if he is transferred to any other department of the same unit, his right to claim a bonus is not going to be affected.

Regards,
R.N.Khola

Dear All,

Please tell me how to classify workers as skilled or semi-skilled. Ours is an engineering unit, and mostly lathe workers. We classified them as semi-skilled, but workers say that we are in the skilled category. Please send us some definitions as per labor law. By my definition, skilled workers should have some degree or matrix passed at least. Please help me.

Bonus is applicable when an employee transfers from one department to another within the same establishment. If an employee has worked for 30 days, then he/she will be eligible for a bonus.

Regards,
Shyam Pandirkar

Can anybody tell me when this amendment will come into force? We are in the process of disbursing bonuses for the financial year ended 31st March 2010.

If an employee's salary is $16,500, and the employer wants to pay a bonus on $16,500, is it possible to pay it on $16,500, or is it paid only on $5,000 as per the new amendment?

Where is the new amendment?

Regards,
R.N.Khola

The minimum bonus payable to an employee is INR 3500 or 8.33%. What about the upper limit or ceiling of INR 10000 on salary? Any employee receiving a salary greater than INR 10000 is not eligible for a bonus. Is the limit of INR 10000 applicable only to the basic salary or to the gross salary as well?

For example, if an employee's basic salary is INR 9500 but their gross salary is INR 50000, are they eligible for the bonus? Similarly, if the basic salary is INR 12000 and the gross salary is INR 20000, is the employee eligible for the bonus?

Taani :)

The above-mentioned amendment has not come into effect; therefore, we do not need to act on it.

Regards,
Shyam Pandirkar

If an employee's basic salary is Rs 10,000 per month and 8.33% is declared as a bonus, what is the calculation? Is it Rs 10,000 or Rs 3,500 only?

If an employee's basic salary is Rs 3,500 per month and 8.33% is declared as a bonus, what is the calculation? Is it Rs 3,500 only?

This means both employees get the same amount of bonus. Is this correct?

Dear Member,

If there is no addition of any DA and Food allowance in the rate of basic, then your statement is correct, subject to the condition that these employees have worked the whole accounting year and have also drawn full wages.

With Regards,
R.N.Khola

If an employee's Basic is Rs 10,000 per month and 8.33% is declared as a bonus, what is the calculation? Is it Rs 10,000 or Rs 3500 only? If an employee's Basic is Rs 3,500 per month and 8.33% is declared as a bonus, what is the calculation? Is it Rs 3500 only?

This means both employees get the same amount of bonus. Is this correct?

If an employee's basic salary is Rs. 10,000 per month and 8.33% is declared as a bonus, what is the calculation? Is it Rs. 10,000 or Rs. 3,500 only?

If an employee's basic salary is Rs. 3,500 per month and 8.33% is declared as a bonus, what is the calculation? Is it Rs. 3,500 only?

This means both employees get the same amount of bonus. Is this correct?

It totally depends on the company's policy. If the company agreed to pay 8.33% on the basic salary, then in the first case, the employee would receive Rs. 10,000. However, if the company declared to pay 8.33% on Rs. 3,500 (minimum bonus), then the employee would get Rs. 3,500 only.

If the organization is less than five years old, are we eligible to pay bonuses to employees?

Dear Member,

If your establishment is covered under the Payment of Bonus Act, 1965 and is less than five years old, then go through section 16 to determine for which of the accounting years you are required to pay bonuses to eligible employees.

R.N.Khola

Where is the new amendment on bonuses? If anyone has the notification, please share the same.

Thank you.

Kindly follow the discussion before you put up your query.

What You Are Asking

What you are asking is what is being discussed here.

Regards.

This is a proposal forwarded in the form of a bill, and it will take a considerable amount of time to become an act.

Regards,
Kishore

Yes, it is now confirmed that there is no change in the Payment of Bonus Act regarding the hike in the ceiling rate and percentage.

Regards,
Pawan Kumar Agrahari
Sr. Executive-HR
Shree Baidyanath Ayurved Bhawan Pvt. Ltd.
Naini, Allahabad.

Sir, please request me to provide information about the Louvre bonus because I am not receiving the full bonus and payment at the cement plant.

Check this new gazette for amendments to the Bonus Act.

I got probation on 13/06/2016, and bonus deductions started. I received confirmation on 13/12/2016, and I resigned from my job on 03/08/2017. Therefore, my previous employer gave me a bonus for the period from June 2016 to March 2017, with the remainder expected in September or October 2017. Since I resigned, is the employer required to provide me with all deductions in the full and final settlement?

I hope this helps! Let me know if you have any other questions.