How Do Companies Decides About Percentage Of Bonus Payment?

Dear All,
Can you clear my doubt about how do companies decides in a year about percentage of bonus to be paid to their employees in a year. Is this optional for companies that will they pay any amount of percentage between 8% to 20% as per their profit or revenue in a year or there is any rule for calculation of bonus in a year.
Regards,
Sudhir

Dear Sudhir,
I think that you will certainly agree with me without any reservation that a HR-Professional ( whether he has an academic back-ground in Law or not ) should first make a reading of the Law that regulates a particular service condition and then raise questions on grey areas which create complications in understanding.My request to you, therefore, is to first make a thorough reading of the Payment of Bonus Act,1965 and understand the definitions... Accounting Year, Appropriate Government,Available Surplus, Allocable Surplus, Banking Company, Non-Banking Company, Employee, Employer, Gross Profits and Salary or Wage and the concepts of minimum bonus and maximum bonus. Even after that, if you have the same doubts, please notify.