Maternity Leave and Bonus Payments: Should Companies Pay Bonuses When ESI Covers Salary?

Dear All,

Please provide clarification on bonus payment in the scenario where an employee is on maternity leave and their salary is covered by ESI during this period. Should the organization still pay the bonus to the employee if they are no longer on the company's payroll?

Thank you.

Dear Srinivas,

The bonus is X% of wages drawn in the respective accounting year. Thus, the bonus will be proportionate to the actual days worked. For the purpose of days worked, days of paid leave, agreed/approved lay off, and maternity leave days have to be considered. Therefore, the employee has to be paid the bonus for the period including maternity leave.

Shailesh Parikh
99 98 97 10 65
Vadodara

Dear Shailesh,

Thank you for your reply.

There is a point in the Bonus Act that states if an employee has been on maternity leave with salary or wage during the accounting year, bonus needs to be paid. In the Bonus Act, it is mentioned that leave with salary or wage should be considered for bonus calculation. However, if the employer did not pay the salary during the maternity leave, and ESIC paid the salary instead, but the leave was provided by the organization, should the organization still pay the bonus?

Please provide your response.

Regards,
Srinivas
9515664910