How Can I Recover My Unpaid Bonus After Leaving My Job? Seeking Advice from Peers

Hello Everyone, I want to put up my query. I was associated with one company for almost 10 years, and for all those years, they paid me a bonus of 20% of Basic + DA. Now, from 01/11/2017, I joined another company, and my bonus from April 2016 to March 2017 has not been paid. All my colleagues of my grade have been paid a bonus for the said period on 10/11/2017.

When I joined the organization, my Basic + DA was (1350 + 4,400). For the financial year April 2015 to March 2016, Basic + DA was (6445 + 13250), and I was paid Rs 47268/-. For the financial year April 2016 to March 2017, Basic + DA was (7235 + 14040).

Now, I have left the organization after completing all formalities like the notice period, and an experience certificate has been issued to me. However, the company has refused to pay me, whereas the former employees of my grade with the same Basic + DA have been paid the bonus.

Now, if I have to recover my bonus from April 2016 to October 2017, what action should I take? Please advise.

Understanding Bonus Eligibility Under the Payment of Bonus Act

As during this period, you were drawing a salary of more than Rs. 21,000/- per month (actually Rs. 21,675), the benefit of coverage under the Payment of Bonus Act 1965 does not accrue to you. Therefore, there is no statutory liability to pay you a bonus as per the Act. However, as your colleagues have been paid, even though they are also not covered under the PB Act, you have been unfairly discriminated against.

Please review the provisions of the scheme under which they have been paid and check whether there is any provision to deny an employee their rightful share solely because they have resigned from service. In case there is no such provision, you have a valid claim. Either a trade union can take up your matter and raise a dispute (as in your personal capacity you are out of coverage of the ID Act 1947), or you will have to stake a claim through the civil court.

But sir, as per clause 12 of the Bonus Act, am I liable for a claim?

Please reply.

[12. Calculation of bonus with respect to certain employees.—Where the
salary or wage of an employee exceeds 4[two thousand and five hundred rupees]
per mensem, the bonus payable to such employee under section 10 or, as the
case may be, under section 11, shall be calculated as if his salary or wage were
[two thousand and five hundred rupees] per mensem.]

Is Case-4 valid in my case?

Bonus Calculation Parameters:

Case 1: Basic less than or equal to 3500 = Bonus = Actual Basic x (Bonus Months) x 20%

Case 2: Basic more than 3500 up to 8400 = Bonus = Rs. 3500 x (Bonus Months) x 20%, Ex Gratia = 0

Case 3: Basic more than 8400 and less than 10000 = Bonus = Rs. 3500 x (Bonus Months) x 20%, Ex Gratia = Basic Salary - 8400

Case 4: Basic more than 10000 = Bonus = 0, Ex Gratia = 1 month Basic Salary

Case 5: Basic changes during the year

Example: 2300 to 3500 = Bonus = (2300 x months paid x 20%) + (3500 x months paid x 20%), Ex Gratia = 0

Example: 3500 to 5000 = Bonus = (3500 x months paid x 20%) + (3500 x months paid x 20%), Ex Gratia = 0

Example: 5000 for 6 months to 8900 for 6 months = Bonus = (3500 * 6 * 20%) + (3500 * 6 * 20%) = 8400, Ex Gratia = (8900 * 6 / 12) - (8400 * 6 / 12) = 250

Example: 8900 for 4 months to 12000 for 8 months = Bonus = (3500 * 4 * 20%) = 2800, Ex Gratia = {(8900 * 4 / 12) - (8400 * 4 / 12)} + {(12000 * 8 / 12)}

Dear sir,

In my case, the employer has included the bonus in the CTC. Am I eligible to claim it?

Please advise.

Bonus Eligibility and Ex-Gratia Clarification

As already clarified, the present wage ceiling for bonus eligibility under the PGA is Rs. 21,000/-, and your pay has been exceeding that limit during the financial year 2016-17. So you cannot benefit under the PBA.

As for ex-gratia, it is a non-statutory scheme, and it depends on the rules of the company. That is why it was desired in the earlier comments to check the provisions of the scheme under which your colleagues have been paid ex-gratia and also check whether there is any provision to deny an employee his rightful share for the sole reason that he has resigned from service. In case there is no such provision, you have a valid claim under the said scheme, and you can approach the company staking your claim.

Will you please shed light on clause no. 12.

Calculation of bonus with respect to certain employees.

Employer says it is a bonus but it is included in CTC. If it is so, then whether my claim is valid or not? Please advise.

The term 'bonus' used in CTC is not in the statutory sense, but a general term used to signify an annual payment calculated on the basis of profit/profitability. By mentioning it to be a bonus, statutory coverage will not apply, but only if the statutory conditions are met, the position regarding it is already explained above.

Bonus Eligibility Ceiling and Payment History

The ceiling for bonus eligibility of wages, Rs. 21,000, commenced from April 2015, if I am not wrong. Before that, it was Rs. 10,000.

In that case, my basic + DA for the 2012-13 financial year was (4150 + 9775), which exceeded the limit of the bonus at that time. However, I was still being paid a 20% bonus at that time. The bonus was part of my CTC with a fixed payable structure of 20% for the last 9 years. Additionally, the person who left the organization before me in that year was also paid a bonus based on the same criteria.

Considering all of the above, I believe that in case of any conflict, I should have a valid claim to receive my rightful share. Please advise.

Bonus Act Ceiling and Payment Discrepancies

As per the Bonus Act, a ceiling of 21,000 is applicable from April 2015, if I am not mistaken. Before that, it was 10,000. In 2013, my Basic + DA (4,150 + 9,775) surely exceeded the limit at that time. However, I was paid a 20% bonus on Basic + DA per month for that financial year, and it was given to us during Diwali, termed as a bonus. Similarly, I have been paid for the last nine years. Hence, the term bonus was part of our CTC and had nothing to do with the profit/profitability of the organization.

Policy Consistency Across Employees

Now the issue is that colleagues of my grade, both current and former, have been paid bonuses on the same basis as mentioned above. Can the organization's policy deviate from person to person? Is that possible?

Please look into this and suggest what should be my stance to claim my rightful share from my previous employer.