Bonus Ceiling Change: Will Employees Get Full 14994 or Just 7000?

Hello Seniors,

As per the latest amendment, the bonus ceiling limit has been increased from 3500/- to 7000/-. Please let me know if an employee's gross salary is 15000/-, then 15000 * 8.33% = 1249.50/-. 1249.50 * 12 (months) = 14994/-. Please tell me, will 14994/- be paid to the employee or only 7000/-?

Regards,
Mukesh

Dear Mukesh,

If his attendance gross earning salary is 15,000 every month, then the formula will be 7,000 * 12 * 8.33%.

No, Mukesh, the workings are a little more complex.

Wages will be considered as actual, minimum wages or ₹7000, whichever is higher. So first, you need to check where he stands in minimum wage scales. Next, the percentage varies from 8.33% to 20%. You need to compute allocable surplus as defined in the act to determine the bonus percentage applicable to your company. Then you can apply the percentage to the wage ceiling and proceed.

By the way, isn't the bonus on basic and DA rather than gross wages?