Kindly let us know the latest amendments to Payment of Bonus Act 1965 & maximum limit of bonus and salary.
From India, Bhubaneswar
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5From India, Bhubaneswar
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Hi, the limit for calculation of Bonus is Rs 15000/- previously it was Rs 10000/- Regards, Siva Kumar Tata
From India, Hyderabad
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From India, Hyderabad
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Dear Siva Kumar, If it is so plz provide us the amendment notification. Regards, R N KHOLA
From India, Delhi
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From India, Delhi
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Sorry, Mr. Shivakumar1611, I do not agree with you. In my experience, as per the Bonus Act of 1965 and Bonus Rules of 1975, the bonus calculation is as follows:
Bonus Calculation Formula
BASIC + DA * Service * Percentage. For example, our company only offers 8.33%, so my bonus last year was 4000 * 8.33% * 12 = 3498.
Bonus Rules
1. One must work at least 30 days in the last financial year.
2. The bonus limit is 3500/- ceiling only.
3. The salary limit is 10000/- only (salaries above 10,000/- are not eligible for a bonus).
4. The limit ranges from a minimum of 8.33% to a maximum of 20% only.
To the best of my knowledge, there have been no recent amendments. If you have a copy of any amendments or other proof, please send it to me.
Regards,
Guru.
From India, Visakhapatnam
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Bonus Calculation Formula
BASIC + DA * Service * Percentage. For example, our company only offers 8.33%, so my bonus last year was 4000 * 8.33% * 12 = 3498.
Bonus Rules
1. One must work at least 30 days in the last financial year.
2. The bonus limit is 3500/- ceiling only.
3. The salary limit is 10000/- only (salaries above 10,000/- are not eligible for a bonus).
4. The limit ranges from a minimum of 8.33% to a maximum of 20% only.
To the best of my knowledge, there have been no recent amendments. If you have a copy of any amendments or other proof, please send it to me.
Regards,
Guru.
From India, Visakhapatnam
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Dear friends, Our respected friend Mr. Khola has raised a vital point. If there is an amendment in the Bonus Act (which there is not yet, as I believe, and many others, including Mr. Khola), the person circulating such information must support it with a document. Otherwise, it will create confusion and bring down the credibility of CITE HR. People take the contents posted on this site very seriously. We all must keep this in mind before posting any information. No intention to hurt anyone.
Regards, Anil Kaushik
From India, Delhi
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Regards, Anil Kaushik
From India, Delhi
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The statement of Mr. Guru is correct. The salary limit as of the date is Rs. 10,000/- only. There is a proposal to enhance it to Rs. 15,000/-. However, the amendment has not taken place yet.
Regards,
D. Phani Kumar
DGM-HR
VASAVADATTA CEMENT
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Regards,
D. Phani Kumar
DGM-HR
VASAVADATTA CEMENT
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Mr. D. Phani Kumar, is correct. There was a proposal to enhance the salary limit upto Rs. 15000/- for eligibility of bonus but this has not taken place yet.
From India, Lucknow
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From India, Lucknow
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Inquiry About Bonus Act Amendment
If anybody can please help to know about the new amendment levied to the Bonus Act for the minimum bonus limit to be increased to 11% from the earlier 8.33%? Is this the new amendment, or is it just a proposed bill as yet? Kindly update.
Regards,
Neelam
From India, Pune
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If anybody can please help to know about the new amendment levied to the Bonus Act for the minimum bonus limit to be increased to 11% from the earlier 8.33%? Is this the new amendment, or is it just a proposed bill as yet? Kindly update.
Regards,
Neelam
From India, Pune
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Please let me know, as per the Bonus Act, if employees drawing more than ₹10,000/- basic salary in a month (Senior Management level) are eligible to receive a bonus or not. If not, how should we address this query if it arises?
Please assist me with this matter.
Thanks,
Chitrappa
Executive - HR
From India, Bangalore
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Please assist me with this matter.
Thanks,
Chitrappa
Executive - HR
From India, Bangalore
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Dear Friends I am enclosing the Latest amendment Bill passed on Payment of Bonus Act in 2010 for your reference and records.
From India, Kumbakonam
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From India, Kumbakonam
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Whether this bill is passed or not, please explain with the gazetted notification. The document attached by our senior, Mr. S. Bhaskar, is the draft pending with both houses of Parliament. Please clarify at the earliest so that the confusion is resolved.
Regards,
Vishal Setia
From India, Faridabad
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Regards,
Vishal Setia
From India, Faridabad
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Dear Mr. Vishal As said by you, it is still in proposal stage only and we can expect soon for its implementation. With warm regards S. Bhaskar
From India, Kumbakonam
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From India, Kumbakonam
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The document attached by Mr. Bhasker is only a notification/bill and it has not been passed so far. I would like to refer to the Press Note dated 29th Oct. 2007, issued by the Honorable President regarding the enhancement of the eligibility limit for the payment of bonus from the salary or wage of Rs. 3500/- per month to Rs. 10,000/- per month. This Press Note is available in some other threads of Cite HR.
In my opinion, when the bill is passed, a similar type of Press Note may also be released.
From India, Lucknow
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In my opinion, when the bill is passed, a similar type of Press Note may also be released.
From India, Lucknow
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In what context do you want the maximum limit of the bonus? If it is for calculation purposes, then it is Rs. 3500 per month. The minimum percentage is 8.33%, and the maximum is 20% as per the Bonus Act. Regarding the payout to the employee, the maximum limit of the salary is Rs. 10,000.
I hope this solves your query.
Regards, Vishal Setia
From India, Faridabad
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I hope this solves your query.
Regards, Vishal Setia
From India, Faridabad
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Welcome to CiteHR. Please find attached the supporting document as required by you.
Regards
From India, Delhi
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Regards
From India, Delhi
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Please let me know which basic salary, i.e., Rs. 10,000/- or Rs. 3,500/-, is taken for the calculation of the bonus. If the wage limit is Rs. 3,500/-, then the Rs. 10,000/- wage limit is considered for eligibility for the bonus.
For the Rs. 10,000/- wage limit, suppose the basic salary is Rs. 8,000.
- Bonus 8.33% = 8,000 * 8.33% = 666
- Ex Gratia on Rs. 8,000/- = 8,000 * 20% - 8,000 * 8.33%
= 1,600 - 666
= Rs. 934/-
Regards,
Parag
From India, Mumbai
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For the Rs. 10,000/- wage limit, suppose the basic salary is Rs. 8,000.
- Bonus 8.33% = 8,000 * 8.33% = 666
- Ex Gratia on Rs. 8,000/- = 8,000 * 20% - 8,000 * 8.33%
= 1,600 - 666
= Rs. 934/-
Regards,
Parag
From India, Mumbai
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Wage Ceiling for Bonus Calculation
The wage ceiling for bonus calculation is still $3,500. If the basic salary is more than $3,500, the bonus should be calculated as mentioned below:
$3,500 x (number of months the employee has worked in that particular financial year) x 8.33% or above up to 20% = Actual bonus.
Regards,
Kamal
From India, Pune
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The wage ceiling for bonus calculation is still $3,500. If the basic salary is more than $3,500, the bonus should be calculated as mentioned below:
$3,500 x (number of months the employee has worked in that particular financial year) x 8.33% or above up to 20% = Actual bonus.
Regards,
Kamal
From India, Pune
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Thank you for your help. Suppose the basic salary is $5400. The maximum percentage is 20%.
Bonus Calculation
Bonus = $3500 * 12 * 8.33% = $3499
Can we also calculate the bonus at the maximum rate of 20%? Bonus at 20% = $3500 * 12 * 20% = $8400
Ex-Gratia Calculation
Ex-gratia = ($5400 - $3500) = $1900 * 12 * 20% = $4560
Please confirm if the above calculations are correct. Also, kindly advise where I should file bonus returns (Form D) in Mumbai and what Form C entails.
Regards,
Parag Chawan
From India, Mumbai
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Bonus Calculation
Bonus = $3500 * 12 * 8.33% = $3499
Can we also calculate the bonus at the maximum rate of 20%? Bonus at 20% = $3500 * 12 * 20% = $8400
Ex-Gratia Calculation
Ex-gratia = ($5400 - $3500) = $1900 * 12 * 20% = $4560
Please confirm if the above calculations are correct. Also, kindly advise where I should file bonus returns (Form D) in Mumbai and what Form C entails.
Regards,
Parag Chawan
From India, Mumbai
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Yes i also agree with Mr. Guru and Mr.Phani. If it exceed Rs 10000/- that can be accounted/paid as exgratia based on the company policy Anu
From India, Madras
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From India, Madras
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I do agree with Mr. Guru. He is absolutely right. However, there are other rules as well that make the company/employer liable for paying bonuses. First of all, the company should be in profit, and there are many other factors under which the employer can exclude themselves from paying bonuses. For more details, please refer to the BONUS ACT.
Regards,
Ms. Bhagat
Mgr - HR
From India, Pune
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Regards,
Ms. Bhagat
Mgr - HR
From India, Pune
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Yes Mr.Phani,bill for amendment was raised in 2010 and still it is not passed.Limit of salary is Rs.10000/-only as on date. Sant Tomar HR-IR Lafarge India P Ltd.
From India, Mumbai
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From India, Mumbai
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ESI its now is 15 k but proposal is for 25000 k. Guru is right bonus is minimum 8.33% mamaximum 20% but it has not take place yet
From India, Pune
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From India, Pune
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Still yet to get any amendment regarding the ceiling limit, they are likely to be revised to either 15,000/- or 19,000/-. The government is planning to raise the bonus amount to whichever is higher.
DVRAO
Group Senior Manager - HR & Admin
From India, Visakhapatnam
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DVRAO
Group Senior Manager - HR & Admin
From India, Visakhapatnam
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Amendments to the Payment of Bonus Act 1965
In September 2015, Shri Bandaru Dattatreya, the Minister of State for Labour and Employment, took note of the 12 demands presented by various trade unions and assured that the Central Government is actively working towards addressing at least 9 of these demands. Amongst other requests, the trade unions emphasized the need to revise the wage eligibility limit and calculation ceiling for bonus payments to align with current economic trends. They proposed increasing the wage eligibility limit from INR 10,000 to INR 21,000 and raising the calculation ceiling from INR 3,500 to INR 7,000 or the minimum wage set by the appropriate Government for that category of employment, whichever is higher.
Per the provisions of the Principal Act, any employee earning a salary of INR 10,000 or less per month and having worked for a minimum of 30 days in an accounting year is entitled to a bonus (calculated as per the methodology outlined in the Principal Act) with a minimum of 8.33% of their salary and a maximum bonus limit of 20% of their salary.
Previously, if an employee's salary exceeded INR 3,500 per month, the bonus calculation assumed their salary to be INR 3,500. The Amendment Act has now raised the wage ceiling for calculation to INR 7,000 and considered scenarios where the minimum wage for such employees may surpass INR 7,000, providing them with the opportunity to receive a higher bonus amount.
I trust this information clarifies any uncertainties.
Regards, Malay
From India, Chennai
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In September 2015, Shri Bandaru Dattatreya, the Minister of State for Labour and Employment, took note of the 12 demands presented by various trade unions and assured that the Central Government is actively working towards addressing at least 9 of these demands. Amongst other requests, the trade unions emphasized the need to revise the wage eligibility limit and calculation ceiling for bonus payments to align with current economic trends. They proposed increasing the wage eligibility limit from INR 10,000 to INR 21,000 and raising the calculation ceiling from INR 3,500 to INR 7,000 or the minimum wage set by the appropriate Government for that category of employment, whichever is higher.
Per the provisions of the Principal Act, any employee earning a salary of INR 10,000 or less per month and having worked for a minimum of 30 days in an accounting year is entitled to a bonus (calculated as per the methodology outlined in the Principal Act) with a minimum of 8.33% of their salary and a maximum bonus limit of 20% of their salary.
Previously, if an employee's salary exceeded INR 3,500 per month, the bonus calculation assumed their salary to be INR 3,500. The Amendment Act has now raised the wage ceiling for calculation to INR 7,000 and considered scenarios where the minimum wage for such employees may surpass INR 7,000, providing them with the opportunity to receive a higher bonus amount.
I trust this information clarifies any uncertainties.
Regards, Malay
From India, Chennai
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Amendment to Payment of Bonus Act 2015.jpg
Bonus act amendment gazette copy.pdf