Are Contract Employees in Indian Government Enterprises Eligible for Bonuses Under New Rules?

Please guide me about employees engaged on a contract basis in a Central Government of India Enterprise drawing a salary below 10000 p.m. Are they eligible to get a bonus as per the latest amendment?

Regards,
Arindam

Dear Under the Bonus Act there is no exemption for Contract Employees. You will have to calculate 8.33% of Rs 3500/- or actual Salary if it is less than Rs 3500/- and pay the minimum Bonus . with kind regards, V.Sounder Rajan Chennai – 600 001. Off : 044-42620864, 044-65874684 ,

Dear Contract Labors also fall under the definition of an Employee as per the Bonus Act. So, they are eligible for a bonus. The quantum of the bonus to be paid will be decided by the top management of your organization. So, consult them for the percentage of the bonus to be paid. Normally, Contract Labors are paid a bonus at 8.33%, but this is not the guiding principle.

Regards,
Nilendra

Dear Mr. V. Sounder Rajan,

Thank you for your reply. Please suggest what to do if the management refuses to pay such a bonus amount to the contract employees engaged for more than two years and drawing a salary of less than Rs 10,000 per month.

Regards,
Arindam

Dear Mr. Nilendra,

Thank you for your reply. Please suggest what to do if the management refuses to pay such a bonus amount to the contract employees engaged for more than two years and drawing a salary of less than Rs 10,000 per month.

Regards,
Arindam

Dear Management,

Your company is not directly liable to pay bonuses to contract labor as they are not employees of your establishment. If the decision is made not to pay bonuses to the contract labor, no legal action can be taken directly against them.

Regards,
Nilendra

Dear Arindam,

Contract labor is not your direct employees, and hence their right to claim a bonus is available only against their employer, the contractor. Their entitlement here depends upon their employer's (contractor) balance sheet and profit and loss account. There is no legal right for contract labor to claim a bonus from the principal employer based on the principal employer's results in an accounting year.

Thanks & Regards,

Kalyan R
Manager - Personnel
Sundaram-Clayton Ltd
Brakes Division
Chennai - 600 058
Mobile: 9840942232

Dear all,

Thank you all for your replies. Please clarify one more thing for me. If an employee is directly employed by a Government of India Enterprise and their salary is paid directly by the company, and the same employee is engaged on a contract basis by the same employer, is the management liable to pay a bonus as per the latest amendment of the act?

Regards,
Arindam Choudhury

Please refer to Section 32 of the Payment of Bonus Act. There are certain government and other establishments on which the act doesn't apply. So, look out, particularly at your establishment, and decide.

If a contractor paid a bonus to his workmen, is it necessary to submit Form D (Return) to the Labour Commissioner?

by kalijanni