The relevant section in payment of bonus act for proportionate reduction in bonus is given below:
"13. Proportionate reduction in bonus in certain cases -
Where an employee has not worked for all the working days in an accounting year, the minimum bonus of one hundred rupees or, as the case may be, of sixty rupees, if such bonus is higher than 8.33 per cent of his salary or wage for the days he has worked in that accounting year, shall be proportionately reduced."
My below interpretation of the above section is correct or not?
Suppose an employee works for only 200 days, and his daily wages are Rs 100 per day and the bonus rate is 10% then he is entiled to a bonus of 200 X 100 *(10/100)=2000
For example , the total working days in the factory in which the employee is working is 240 days
In such a case the bonus payble would be =
actual bonus payble - (minimum bonus payble/numbe of days worked)
i.e., 2000 - (100/200)
is this correct?
From India, Mumbai
9"13. Proportionate reduction in bonus in certain cases -
Where an employee has not worked for all the working days in an accounting year, the minimum bonus of one hundred rupees or, as the case may be, of sixty rupees, if such bonus is higher than 8.33 per cent of his salary or wage for the days he has worked in that accounting year, shall be proportionately reduced."
My below interpretation of the above section is correct or not?
Suppose an employee works for only 200 days, and his daily wages are Rs 100 per day and the bonus rate is 10% then he is entiled to a bonus of 200 X 100 *(10/100)=2000
For example , the total working days in the factory in which the employee is working is 240 days
In such a case the bonus payble would be =
actual bonus payble - (minimum bonus payble/numbe of days worked)
i.e., 2000 - (100/200)
is this correct?
From India, Mumbai
Already you calculated as per his no. of days present. Then further reducing the amount is not correct. If a person works on all working days then he will get Minimum (8.33%), Rs.3500/- and Maximum (20%), Rs.8400/-. If you declare 10% means the minimum bonus eligible is Rs.4200/-. You can proportionately deduct by using Rs.4200/- / No of working days X No of days worked by the worker.
This subject has been discussed many times in this forum. You can get the details by simply typing the key words on the Find Information Bar and click on the research Tab which is available in the top of this page.
Hope you understood.
From India, Kumbakonam
This subject has been discussed many times in this forum. You can get the details by simply typing the key words on the Find Information Bar and click on the research Tab which is available in the top of this page.
Hope you understood.
From India, Kumbakonam
Dear Human Honchos,
The calculation you made in your query is not correct.
Reading of Section 13 of POB Act, alone will not help to solve your question. This section has to be read with section 10 of the Act. Section 10 prescribes for payment of Minimum Bonus at a rate of 8.33% of the salary or wage or Rs. 100 whichever is higher. In case of a employee below 15 years of age, the min. amount will be Rs. 60. In this context, if we read the section quoted by you, it gives us a logical meaning.
Sec. 10 tells us the minimum per cent of Bonus and also Minimum amount of Bonus. Now as far percentage of Bonus is concerned, there is no any ambiguity in calculation. But it is a problem when any person has not even earned a min. amount of Bonus because of his less earnings. Say a person's salary is Rs. 50 pm and he has worked for 11 months then his bonus at 8.33% will be about Rs. 46. But, because of the minimum amount of a bonus is prescribed, you will have to pay Rs. 100 as bonus. This discrepancy has been taken care of by Section 13 as referred by you. "if such bonus (i e Min. Bonus Amt. i. e. 100 or 60) is higher than 8.33 per cent of salary,......, shall be proportionately reduced"
So, the calculation you have made are not correct.
The provision of Section 13 has become redundant in today's scenario, as at present nobody has a salary below Rs. 100 a month.
I hope you got the answer.
From India, Kolhapur
The calculation you made in your query is not correct.
Reading of Section 13 of POB Act, alone will not help to solve your question. This section has to be read with section 10 of the Act. Section 10 prescribes for payment of Minimum Bonus at a rate of 8.33% of the salary or wage or Rs. 100 whichever is higher. In case of a employee below 15 years of age, the min. amount will be Rs. 60. In this context, if we read the section quoted by you, it gives us a logical meaning.
Sec. 10 tells us the minimum per cent of Bonus and also Minimum amount of Bonus. Now as far percentage of Bonus is concerned, there is no any ambiguity in calculation. But it is a problem when any person has not even earned a min. amount of Bonus because of his less earnings. Say a person's salary is Rs. 50 pm and he has worked for 11 months then his bonus at 8.33% will be about Rs. 46. But, because of the minimum amount of a bonus is prescribed, you will have to pay Rs. 100 as bonus. This discrepancy has been taken care of by Section 13 as referred by you. "if such bonus (i e Min. Bonus Amt. i. e. 100 or 60) is higher than 8.33 per cent of salary,......, shall be proportionately reduced"
So, the calculation you have made are not correct.
The provision of Section 13 has become redundant in today's scenario, as at present nobody has a salary below Rs. 100 a month.
I hope you got the answer.
From India, Kolhapur
Dear Human Honchos,
You have to compute 8.33% of the actual wages earned for the period for which you are computing Bonus. For example if your Bonus computation period is April to March of the succeeding year, sum up the wages he has earned during the period and multiply it by 8.33% and this is the bonus payable to the employee.
In case the wages earned by the employee is beyond Rs.3500/- then the wages for the purpose of computation of bonus shall be restricted to Rs.3500/-. In such a case the eligible wages for the month (if he works for the whole month) shall be Rs.3500/- for the purpose of computing Bonus. However, if the employee was on Loss of pay for 3 days then the bonus wages shall be reduced proportionately.
M.V.Kannan
From India, Madras
You have to compute 8.33% of the actual wages earned for the period for which you are computing Bonus. For example if your Bonus computation period is April to March of the succeeding year, sum up the wages he has earned during the period and multiply it by 8.33% and this is the bonus payable to the employee.
In case the wages earned by the employee is beyond Rs.3500/- then the wages for the purpose of computation of bonus shall be restricted to Rs.3500/-. In such a case the eligible wages for the month (if he works for the whole month) shall be Rs.3500/- for the purpose of computing Bonus. However, if the employee was on Loss of pay for 3 days then the bonus wages shall be reduced proportionately.
M.V.Kannan
From India, Madras
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