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saswatabanerjee
2392

Dear Padmakar_marudkar,

First, please ensure in future you put your query in a new post, or it is likely it will be ignored by the members if you put it in a post that is 5 years old.

To answer your question, bonus is a function of profit. the basis of computation is given in the act. You do not have a choice of lowering it on your own or even with the approval of the union. I am assuming you are in India and the bonus is covered under payment of bonus act.

If your profit as computed under the act is more than 20% of your annual salary (check ceiling and eligibility), you have to pay 20% bonus. If it is lower, then only you can pay lower bonus but not below 8.33%

If you are referring to bonus other than that under payment of bonus act, then lowering it unilaterally is alternation of terms of employment and can be raised as an industrial dispute. In that case, you need approval of your union

From India, Mumbai
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