Can a Company Stop Bonuses for Employees Earning Over 21000? Seeking Advice on Policy Change

Dear Senior,

Please suggest, our company was paying a bonus to all its employees whether their salary is less than 21000 or more. It was good for everyone. But now, they are saying that the bonus is applicable only to those whose basic salary is up to 21000. Approximately 40-50 employees are on this list. Is it possible that they can discontinue the bonus for their employees?

Sir, I have read the notification. My question is that my salary is $21,500, and I got a bonus up to March 2019. However, now the company is denying to pay a bonus for 2019-20 because my salary exceeds the limit. But last year, I received the same salary. How is it possible that the bonus has been discontinued? I have been receiving the same salary for the past two years, so please advise.

Thank you.

Statutory Bonus Eligibility

Statutory bonus is payable for the financial year (1.4... to 31.3...) following the finalization of the employer's accounts, subject to certain legal provisions. Therefore, the bonus for the financial year 2017-18, payable in 2018-19, would have been paid last year. Presumably, in the financial year 2018-19, your salary would have crossed the cut-off of Rs. 21,000/-, and therefore, you are not eligible for the year 18-19.

Proportionate Bonus Consideration

Possibly, if the salary increase took place in between the financial year, there might be chances for a proportionate bonus. However, check the facts with your HR/Finance team and get it clarified to your satisfaction.