Bonus Calculation Dilemma: Should It Be Based on Fixed or Actual Salary?

Dear Seniors, should we calculate the bonus according to the fixed salary (Basic + DA) or on the basis of the actually paid salary (Basic + DA) to an employee?

Bonus should be calculated on the basis of earned basic + DA before deduction of ESI and PF.

Dear Suhas,

Bonus calculation is on the salary (with general components as basic+DA) up to Rs. 3,500. That is, if the salary is below or equal to Rs. 3,500, the actual salary will be taken for bonus calculation. If it is above Rs. 3,500 and up to a maximum of Rs. 10,000; Rs. 3,500 will be the salary for bonus calculation. For a salary above Rs. 10,000, there will not be any statutory claim for a bonus.

Abbas.P.S

I think there is a slight change in the bonus salary (with general components as basic + DA). It is up to Rs. 5500, with a maximum of Rs. 15000. For salaries above Rs. 15000, there will not be any statutory claim for a bonus.

For bonus calculation, basic plus DA are taken into account. The actual salary paid is considered if it is below Rs. 3500. For salaries above Rs. 3500, only Rs. 3500 is taken into consideration up to Rs. 10000. For salaries exceeding Rs. 10000, no bonus is payable.

Thank you.

Best regards

The salary, for the purpose of payment of bonus, consists of Basic, DA, and the cash equivalent of the food concession provided to the employees, subject to the limits as described by Abbasiti in post #3.

The new limits, as pointed out by TD Jhadav in post #4 above, will soon be operative. These have yet to be officially notified.

I would like to know if companies want to pay a bonus for employees who are earning more than 10K (basic + DA), what should the calculations be? Or is that at the discretion of the management to decide on the amount?