Understanding Bonus Structures in India: How to Align with Government Rules?

Dear All,

I am working with a manufacturing company, and we are planning to increase the salaries for our employees after one year. Hence, can anyone help me out with the bonus structure/percentage as per government rules?

Thanks in advance.

Regards,
Madhu

Hi Madhu,

Recently, the government has increased the bonus payable to employees as follows: Bonus shall be paid at 8.33% on the wages, and it should be a minimum of 7000/- or equal to the minimum wages applicable in your area, whichever is higher. This increase is effective from April 2014 with retrospective effect.

Please let me know if you need any further information.

Thank you.