hello,
I work for a BPO and i would like to know what components of salary are calculated for statutory bonus and i am also mentioning the components that are in my salary slip please let know about this.
1.Basic
2.HRA
3.Conveyance Allowance
4.Medical Reimbursements
5.Leave Travel Allowance
6.Coach Allowance
Regards
Feroz
From India, Hyderabad
I work for a BPO and i would like to know what components of salary are calculated for statutory bonus and i am also mentioning the components that are in my salary slip please let know about this.
1.Basic
2.HRA
3.Conveyance Allowance
4.Medical Reimbursements
5.Leave Travel Allowance
6.Coach Allowance
Regards
Feroz
From India, Hyderabad
Dear Feroz, Why don’t you go through Sec.2(21) of the Payment of Bonus Act,1965 and then raise this query in case of still any doubt?
From India, Salem
6018From India, Salem
Dear Friend,
For Bonus calculation only Basic+DA and VDA is to be taken. Other allowances should be taken. In the absence of DAs, the bonus is to be calculated only on Basic. It should be in line with the Minimum wages Act or the minimum bonus of Rs. 7000/-.
G.K.Manjunath,
Sr. Manager-HR
From United States, Cambridge
For Bonus calculation only Basic+DA and VDA is to be taken. Other allowances should be taken. In the absence of DAs, the bonus is to be calculated only on Basic. It should be in line with the Minimum wages Act or the minimum bonus of Rs. 7000/-.
G.K.Manjunath,
Sr. Manager-HR
From United States, Cambridge
In India, the payment of statutory bonus is governed by the Payment of Bonus Act, 1965, which mandates employers to pay an annual bonus to eligible employees. The bonus is calculated based on various components of the employee's salary, as defined by the Act.
Here are the components of salary that are calculated for statutory bonus:
Basic Salary: The basic salary is the fixed amount paid to an employee before any allowances or deductions. It is the primary component used to calculate the bonus and is usually a percentage of the employee's total salary.
Dearness Allowance: Dearness Allowance (DA) is an allowance paid to employees to offset the impact of inflation on their salaries. It is usually a fixed percentage of the basic salary and is also considered while calculating the bonus.
Retaining Allowance: Retaining allowance is paid to employees who have been retained by the company during difficult times, such as an economic downturn or a temporary shutdown of operations. This allowance is also included in the calculation of statutory bonus.
Commission: If an employee is paid a commission in addition to their salary, then the commission amount is also considered while calculating the bonus.
Other Allowances: Other allowances, such as house rent allowance, conveyance allowance, medical allowance, and education allowance, are not considered while calculating the bonus.
It's worth noting that the bonus calculation is based on a minimum percentage of the employee's salary, as defined by the Payment of Bonus Act, 1965. As per the Act, the bonus payment should not be less than 8.33% of the employee's salary, subject to a maximum of 20% of the salary.
In conclusion, the components of salary that are considered for the calculation of statutory bonus include the employee's basic salary, dearness allowance, retaining allowance, and commission. Other allowances are not considered while calculating the bonus.
Here you can find some more relevant information: Salary Components in India
From India, Mumbai
Here are the components of salary that are calculated for statutory bonus:
Basic Salary: The basic salary is the fixed amount paid to an employee before any allowances or deductions. It is the primary component used to calculate the bonus and is usually a percentage of the employee's total salary.
Dearness Allowance: Dearness Allowance (DA) is an allowance paid to employees to offset the impact of inflation on their salaries. It is usually a fixed percentage of the basic salary and is also considered while calculating the bonus.
Retaining Allowance: Retaining allowance is paid to employees who have been retained by the company during difficult times, such as an economic downturn or a temporary shutdown of operations. This allowance is also included in the calculation of statutory bonus.
Commission: If an employee is paid a commission in addition to their salary, then the commission amount is also considered while calculating the bonus.
Other Allowances: Other allowances, such as house rent allowance, conveyance allowance, medical allowance, and education allowance, are not considered while calculating the bonus.
It's worth noting that the bonus calculation is based on a minimum percentage of the employee's salary, as defined by the Payment of Bonus Act, 1965. As per the Act, the bonus payment should not be less than 8.33% of the employee's salary, subject to a maximum of 20% of the salary.
In conclusion, the components of salary that are considered for the calculation of statutory bonus include the employee's basic salary, dearness allowance, retaining allowance, and commission. Other allowances are not considered while calculating the bonus.
Here you can find some more relevant information: Salary Components in India
From India, Mumbai
Bonus calculation is done only on the basis of Basic & DA. No other allowances whatsoever name we call are not part of the Bonus Calculation. Please read the PB Act properly and satisfy.
S K Bandyopadhyay ( WB, Howrah)
CEO-USD HR Solutions
+91 98310 81531
USD HR Solutions – To Strive towards excellence with effort and integrity
From India, New Delhi
S K Bandyopadhyay ( WB, Howrah)
CEO-USD HR Solutions
+91 98310 81531
USD HR Solutions – To Strive towards excellence with effort and integrity
From India, New Delhi
The components of salary considered for the calculation of statutory bonus are the basic salary and dearness allowance (DA). Other allowances like HRA, conveyance allowance, medical reimbursements, leave travel allowance, and coach allowance are typically not included in the calculation.
The formula for calculating the statutory bonus is:
Statutory bonus = (Basic salary + DA) * Percentage of bonus
The percentage of bonus can vary between 8.33% and 20%, depending on the company's profits or other factors.
As an example, if an employee's basic salary is Rs. 10,000 and their DA is Rs. 2,000, and the company applies a 10% bonus rate, the statutory bonus would be:
Statutory bonus = (10,000 + 2,000) * 10/100 = Rs. 1,200
I hope this clarifies the calculation of statutory bonus. If you have any more questions, feel free to ask!
From India, Dombivali
The formula for calculating the statutory bonus is:
Statutory bonus = (Basic salary + DA) * Percentage of bonus
The percentage of bonus can vary between 8.33% and 20%, depending on the company's profits or other factors.
As an example, if an employee's basic salary is Rs. 10,000 and their DA is Rs. 2,000, and the company applies a 10% bonus rate, the statutory bonus would be:
Statutory bonus = (10,000 + 2,000) * 10/100 = Rs. 1,200
I hope this clarifies the calculation of statutory bonus. If you have any more questions, feel free to ask!
From India, Dombivali
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SALARY CAN BE SPLIT INTO COMPONENTS BUT NOT LESS THAN THE MINIMUM WAGES.docx