Is the Bonus Calculation Limit Still Rs. 3500, or Has It Increased Recently?

As per my knowledge, the bonus calculation limit is Rs. 3500 per month based on the basic salary. Please help me determine whether the limit has been increased. Last year, it was reported in some newspapers that the Government is considering raising the limit.

Regards,
RB

This limit has not been increased so far.

Regards,
R.N. KHLOA

Supplementary Information on Bonus Amendment Bill

An amendment bill has already been made as the Payment of Bonus (Amendment) Bill, 2010 (Reference Bill No. 15 of 2010), wherein the following amendments are sought:

1. Eligibility limit for payment of bonus is enhanced from ₹10,000 to ₹15,000.
2. Percentage of the minimum bonus payable is increased from 8.33% to 11%.
3. Calculation ceiling of bonus is raised from ₹3,500 to ₹5,000.

Thanks.

Regards,
R K Nair

Thank you for your valuable inputs. I am also enclosing the amendment notification and the bill for members' reference.

Regards,
S. Sethupathy
Excellent HR Services, Erode.

It was just a draft bill; it's not yet published in the Gazette of India, hence not applicable. The current bonus ceiling of 3500 will continue until the publication of the amendment in the Bonus Act.

Thanks,
Sunil Nipurte
Mumbai

Please let me know if the recommendations for enhancing the above limits have been accepted and if the amendment bill has been passed.

Thanks,
Sastry

Supplementary Information on Bonus Amendment Bill

An amendment bill has already been made as the Payment of Bonus (Amendment) Bill, 2010 (Reference Bill no. 15 of 2010) wherein the following amendments are sought:

• The eligibility limit for payment of bonus is enhanced from ₹10,000 to ₹15,000.

• The percentage of the minimum bonus payable is increased from 8.33% to 11%.

• The calculation ceiling of the bonus is raised from ₹3,500 to ₹5,000.

Please send me a copy of the Government Order (G.O.) regarding the above amendment bill.

In bonus calculation in the industry (manpower supplier), bonus = Basic * 8.33/100 OR Basic + DA * 8.33/100.

Regards,
Kumar

Please clarify: My staff's basic salary is 4365 and DA is 2582, totaling 6947. For the bonus calculation, should it be 6947 * 8.33% or 4365 * 8.33%? Please reply.

Regards,
Kumar

Dear Senthil,

It must be 3500 x 8.33% because the Basic or Basic + DA exceeds the limit of Rs. 3500. The bonus calculation is always based on Basic + DA or the Minimum Salary (as per the Minimum Wages Act) set by the appropriate government.

Regards,
Kumar

In Bonus - Our Basic is 4350 and DA is 2582. How do we calculate the bonus? Is it 4350 + 2582 * 8.33% or 4350 * 8.33%? Please clarify.

Regards,
Kumar

Is it mandatory to maintain the same percentage of bonus in the coming years if it's higher than 8.33% and subject to the minimum profits of the organization in that particular year?

With thanks,
Rao T.N.

Hello All, I am a student of MSW, and recently I have studied this act. There is no change in the ceiling of bonus calculation; it remains at 3500 to 5000. Seniors' views are welcome.

Thank you,

Harshil Khatri
Vadodara

Please find the attached file. It may help you with a very brief idea of the calculation of Bonus according to the Payment of Bonus Act, 1965.

Dear Sir,

It is compulsory under The Payment of Bonus Act, 1965, under Section 1, for all employees in a company to receive a bonus. What if the company is not paying the bonus to all employees? Can an employee take any steps, or what can he do?

Dear Sir,

It is compulsory under The Payment of Bonus Act, 1965, under Section 1, for all employees in a company to receive a bonus.

What if the company is not paying the bonus to a few employees? Can an employee take any steps, or what can they do?

Dear Mr. Senthil,

As per the latest amendment in the Bonus Act of 1965, the minimum wages for bonus calculation have been raised from 3500 to 7000. Therefore, in your case, the minimum of 7000 should be used for the calculation.

Thank you.

Hi,

I want to know how to calculate a bonus and if the 21000 ceiling point is based on basic salary or gross salary.

Dear Member,

According to the Payment of Bonus Act, 1965, we are not to deduct any bonus amount from the salary of the employee. The employer is to pay a bonus considering basic & DA. If DA is not there, then we are to consider only basic wages. For more details, you can go through the definition of wage/salary under this Act.

Regards,
R N KHOLA

In an accounting year, i.e., from April 1, 2020, to March 31, 2021, if an employee has a salary of Rs. 16,000 a month and has worked for 70 working days in the whole accounting year, is she eligible to get a bonus? If yes, please share the calculation about the bonus payable to her.