Hello friends, I am working in a manufacturing unit in Pune. We are under residuary category. The wages of the workers have been bifurcated during the last agreement, based on which 20% Bonus has been disbursed for the year 2007-08. Now the Labour Officer is insisting that the Bonus has to be Rs.8,400/- and cannot be anything less than that. Is this a valid statement? My Management is quite clear that the break up of the wages - so long as they are above minimum wages and there is a settlement with the workers' Union - GLO cannot dictate how much basic and bonus is to be paid. Please guide. Secondly, we pay wages/salaries through Bank and have been giving salary slips to all employees. Now GLO is insisting on Presenty cards which we discontinued after speaking with the workers. GLO also is insisting on taking permission from government for issuing pay slips - but we have not mentioned anything about computerising salary. Is he right? Please reply soon. Kalpana Iyer
From India, Pune
10From India, Pune
The basic salary (+ DA if applicable) of the employees who are eligible for bonus is not indicated in the post. What for Rs 8400 stands? Please clarify. Labour Officer has nothing to do with bonus and matters connected therewith so long as there is no dispute. Certainly, the Labour officer can ensure whether the company pays minimum wages @ 8.33% or not. If the company is paying minimum wages then the question of escaping will not arise. I am not well acquainted with the word 'Presenty Card'. I presume it is a document in hard to show the salary with separate columns for Basic Salary, Dearness Alloance, Overtime wages, HRA, CCA etc , Gross salary and with colums for deductions towards, ESI, EPF, etc. Though you can generate pay slips in soft form it is advisable to have a record of payment of wages in hard form also. Regards, Madhu.T.K
From India, Kannur
From India, Kannur
Dear Mr. Madhu: Thanks for a prompt reply. ·We are paying minimum wages, but the break up is as per the wage settlement with the Union. ·8,400 Bonus is the limit as per last government notification. Minimum salary (Basic + DA) to be considered for Bonus = 3,500/- and maximum payable bonus @ 20% = 8,400/- maximum. ·My workmen gets Bonus @ 20%, ranging from 5,500/- to 3,500/- depending upon the break up of his individual wages. Reg. Presenty Cards which are supposed to be issued monthly, well they are perhaps called Attendance Cards. We are supposed to indicate a “P for days present against each date of the month. Salary details are not on this card. We are maintaining proper muster and salary/wages register in hard form and also taking signatures every month. Muster also shows leave balance. Still we are issuing Pay Slip also, but not the cards. Hope you have more clarity on the issue now. Please comment. Regards, Kalpana Iyer
From India, Pune
From India, Pune
Yes, Rs 8400 is the maximum bonus payable under the Payment of Bonus Act calculated @ 20% of Rs 3500 per month. An employee getting more than Rs 3500 but less than Rs 10000, will also be getting bonus as if his salary was Rs 3500. It is not mandatory to pay maximum bonus but what is required is to pay minimum bonus @ 8.33% and you are paying the maximum bonus also, I understand. Your workers' wages may be in the range from Rs 1458 to Rs 2291, as I understand from the amount of bonus paid. From your post I also understand that minimum wages is ensured. If it is so, there is no validity for the statement of DLO asking to pay maximum bonus. As pointed out earlier, the DLO has to interfere only when you pay lesser than the minimum bonus and there exists any dispute regarding rate of bonus and calculation of bonus. If you have been served any notice in this reagrd, you can sumit your reply stating that you have paid bonus @ 20% of basic + DA and since employees are drawing less than Rs 3500 as wages the question of computing bonus at Rs 3500 will not arise. I understand that Presenty Card is nothing but attendence card as per Factories Act or Shops and Establishment Act. The attendance card is a primary record of employees' attendance. it is normally issued to those who do not 'sign' the muster roll but whose attendance is marked in the muster roll by time office clerk. This marking of 'P' for present and 'A' for absent is done after collecting the attendance cards from the factory gate where the cards are placed by the respective employee. Attendance Card in form 28 (I believe so under the Factories Act) is a statutory document as far as a factory is concerned. If you can resume issuing the cards, better do that. I do not think that prior permission is required for issuing pay slips. Please see whether any provision is quoted by the DLO in this regard. Regards, Madhu.T.K
From India, Kannur
From India, Kannur
Dear Ms Kalpana, What all the discussion is going is valid as per the statutory complainace. Well i need to add that Bonus is calculated on the basis of the profit earned by the organisation in the current year. Of this Bonus form has to be submitted to the govt which is certified by the account dept and certified by the a/c audit of your firm. Secondly, for making P if the workforce is less than 150 then you have to keep a seperate attendance record with marking P OR else worker resuming to the duty had to sign in the register in presence of the Security officer. OR else time office is best to obtain record. Further, if 1 to 3 day of every month in case of time office you have to send attendance record department wise and verified and thereby sign on it. This record has to be kept as record for HR Dept for atleast period of one year. Further, of the calculation done for the Bonus are you having the hard copy? In this each month along with the worker working or left have been calculated? If yes then there is no issue. Lastly but the least, very fact (practical) during Diwali have you provided the Labour Officer a gift, voucher or yearly token of amount?? which is Man/Comp With Regards Vivek
From India, Ahmadabad
Hi Kalpana, There's already been a nice discussion on this forum with some very appropriate contributions. Just to add a little, some of the Labour Office officials especially in non-metros have largely to reconcile on computerised statements generated by Companies. For instance, in Delhi, by experience, there has been an acceptance of the computerised statements of returns compilation and pay slips. Sadly, the "babus" or "clerks" and their mandarin bosses there have shown maximum resistance to change for eternity now. There would, well nigh, only do what their forefathers have been doing - the old mills paper grind. Therefore, it may be advisable to maintain certain documentation. Payslips will continue to be given and the Labour Office has no say or objection to that. Any objections are baseless. You could though maintain the Presenty cards that they insisted on (though an unnessary increase in efforts and paper work), lest they keep pestering you by mentioning negative comments on your inspection book and ask for some "palm greezing" repeatedly. I am certain, A, B, C registers, all challans and returns are being filed otherwise. Thank our stars that they have allowed credit to the bank accounts directly. They could still have insisted on the mundane process of payment in cash (as per stipulation in The Payment of Wages Act). Bonus, once applicable, as we all know is calculated by the process of computation of gross profits (First Schedule Sec 4 (a), set on and set off (Form B Rule 4 (b) and allocable/available surplus (as the case may be) (vide Form A Rule 4(1) u/s Sec 2(4)on profits. Also, Form C Rule 4 (c) for Bonus paid to employees for the relevant accounting year ending is maintained/filed as also Form D Rule 5 as Annual Return. His objections and insistence of payment of bonus @ 20% is illfounded and baseless. Often, these guys don't know themselves or try to browbeat company officials due to their lack of understanding. Let his objections be provided in writing if he continues to bother you. A befitting reply, compliant with law, will set it all right! Regards, Rahul Kumar
From India, New Delhi
From India, New Delhi
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