Left Before Bonus Payout: Is It Fair to Miss Out on My Bonus After Resigning?

Bonus Payment Query

My question is regarding the bonus payment. I left the organization on 29th September 2010, and the bonus was paid to other employees in October 2010. I was working in the company from May 2008, so almost 2½ years. (For 2009, I received 1 month's salary as ex-gratia/bonus.) I didn’t get a bonus for last year. After asking, they told me that for a contract employee who has resigned, they don’t pay the bonus. Is it legally correct? Am I not supposed to get my bonus?

Kindly revert. It's urgent.

Thanks & Regards,
Smita.

Payment of Bonus Act and Fixed-Term Contracts

There is no provision for the treatment of employees on fixed-term contracts in the Payment of Bonus Act. If you are an employee entitled to receive a bonus based on your monthly salary not exceeding Rs 10,000, you are eligible to receive it. However, the Payment of Bonus Act applies to a factory or establishment with at least 20 employees. Additionally, there is a probationary period of five years or until the establishment starts making a profit, whichever comes first, to determine the liability for bonus payment.

If your establishment does not fall under the purview of the Act or has not completed five years or generated profit since its inception but provided ex gratia payments instead of a bonus to employees in the previous year, the company may withhold payment from an employee who is no longer employed there. Therefore, it is essential to ensure that the company has only disbursed bonuses and not ex gratia payments before escalating the matter in writing to the company's higher authorities or the Labor Department, if necessary.

Regards,
Madhu.T.K