Understanding the 2016 Bonus Payment Amendments: What Does This Mean for You?

Friends,

Please find attached the notification dated 26.9.2016 on the subject.

Thanks

Thank you for the information, sir. Could you please help me understand what has actually been omitted from the act?

Regards,
Sathya Narayana Y S

Nice update, can anyone help me understand whether we should follow the old rule or implement the new one?

Thanks & Regards,

Sumit Kumar Saxena

Saxena,

The rule was earlier amended in 2014, wherein it was stated in Rule 5(1) that returns shall be submitted by 1st February. The proviso to 5(1) stated that the time limit is as specified under Section 19. This proviso is going to be deleted.

Does this mean the manual return is no longer required, but the Unified Annual Return in the Shram Suvidha Portal (as per rules amended vide G.S.R. 784(E), dated the 10th November 2014) is required?

Sir,

Thanks for the information. Can you please help me understand what has actually been omitted from the act?

Regards,
Sanjay

Sir,

Where is it mentioned in Rule 5, Subrule 1 about the time limit? I can't find this rule. Could someone please explain it to me?

Regards,
Sanjay

Annual Returns Before Amendment

Before the amendment, the rule read as follows:

Annual Returns

5. (1) Every employer shall, on or before the 1st day of February each year, upload annual returns in Form D on the web portal of the Ministry of Labour and Employment, providing information on the particulars specified for the preceding year. Provided that the annual returns shall be filed within the time limit specified in Section 19 of the Act.

(2) Every employer may file annual returns in Form D to the Inspector on or before the 1st day of February each year, giving information on the particulars specified for the preceding year. Provided that during inspection, the inspector shall request the production of the accounts, books, registers, and other documents if they are maintained in manual or electronic form, as the case may be.

Explanation: For the purposes of this sub-rule, the expression "electronic form" shall have the same meaning as assigned to it in clause (r) of Section 2 of the Information Technology Act, 2000 (21 of 2000).

Section 19 prescribes a time limit of 8 months for payment of bonus. It does not prescribe a time limit for filing a return. The proviso to Rule 5(1), which referred to Section 19, has been omitted. It is now clear that the return has to be filed by the 1st of February as provided in Rule 5(1).

Sir,

Please help me understand what is allocable surplus. I can't comprehend it as per subsection 4 of the Payment of Bonus Act, 1965.

Regards,
M. Sanjay

Hi Sanjay,

I'd be happy to help you with your query.

The term "allocable surplus" refers to the amount of profits available for distribution as bonuses to employees under the Payment of Bonus Act, 1965.

As per subsection 4 of section 2 of the act, allocable surplus is calculated based on certain criteria outlined in the legislation. It is essential for employers to understand and comply with these provisions to ensure fair and accurate bonus payments to employees.

If you have any further questions or need clarification on this topic, feel free to ask.

Best regards

Good Afternoon to All,

Does this Amendment in Rule mean that there is no need to submit the Annual Return under the Payment of Bonus Act - The Payment of Bonus Rules - Rule No. 5? Can you please help me to clear my doubt.

Thanks & Regards,
Vivek Kharshikar