Dear Sir,
Our Company has a process of releasing bonus for the previous financial year on every diwali i.e. bonus for the FY 14-15 to be release on Diwali of FY 15-16.
One of our employee had left the organisation in October 2015. Now he wants his complete bonus for FY 14-15 & FY 15-16 (total 19 months). He is saying that without getting bonus for 19 months his full and final settlement is not complete and he will sue the company if not paid? can he claim bonus for both the years. Is he eligible for complete 19 months or not? Please advice.
From India, Delhi
Our Company has a process of releasing bonus for the previous financial year on every diwali i.e. bonus for the FY 14-15 to be release on Diwali of FY 15-16.
One of our employee had left the organisation in October 2015. Now he wants his complete bonus for FY 14-15 & FY 15-16 (total 19 months). He is saying that without getting bonus for 19 months his full and final settlement is not complete and he will sue the company if not paid? can he claim bonus for both the years. Is he eligible for complete 19 months or not? Please advice.
From India, Delhi
Dear Shasi,
Bonus is a payment based on the performance of the establishment in a particular accounting year. The performance of the establishment in a particular accounting year can be ascertained when its accounts are balanced after the close of it. An employee leaving the establishment in October 2015 can claim his bonus for the AY 2014-15 along with his FF Settlement but not for the AY 2015-16. Better add a clause in the FF Settlement that his proportionate bonus for the AY 2015-16 would be paid to him as soon as it would be declared which can not be resisted legally.
From India, Salem
6018Bonus is a payment based on the performance of the establishment in a particular accounting year. The performance of the establishment in a particular accounting year can be ascertained when its accounts are balanced after the close of it. An employee leaving the establishment in October 2015 can claim his bonus for the AY 2014-15 along with his FF Settlement but not for the AY 2015-16. Better add a clause in the FF Settlement that his proportionate bonus for the AY 2015-16 would be paid to him as soon as it would be declared which can not be resisted legally.
From India, Salem
First, are you talking of statutory bonus under payment of bonus act ? Or is this performance bonus as per company norms ?
If it is performance bonus, then there is no compulsion on the company to give it, and your employees claim has no legal standing.
If it is under pay,net of bonus act, then it has to be paid within 8 months of the end of the financial year. The employee has no right to claim it with full and final, though most companies prefer that route. Instead he needs to come at the time of payment of bonus and collect it. The company should send him a notice asking him to collect his bonus. There is nothing in law that requires the company to pay bonus at time when the employee is leaving the company.
I wonder if the person even knows what it means to file a case, including things like the cost of lawyer fees and time needed off from office to attend court cases.
From India, Mumbai
If it is performance bonus, then there is no compulsion on the company to give it, and your employees claim has no legal standing.
If it is under pay,net of bonus act, then it has to be paid within 8 months of the end of the financial year. The employee has no right to claim it with full and final, though most companies prefer that route. Instead he needs to come at the time of payment of bonus and collect it. The company should send him a notice asking him to collect his bonus. There is nothing in law that requires the company to pay bonus at time when the employee is leaving the company.
I wonder if the person even knows what it means to file a case, including things like the cost of lawyer fees and time needed off from office to attend court cases.
From India, Mumbai
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