Sir, Can any one help me to know how to calculate bonus for the employees...
1. Is it compulsory to pay bonus to all employees?
2. Who is eligible to get bonus?
3. What is the minimum & maximum %?
4. Please guide me on the entire calculation...
Regards,
Karthik P
From India, Thrissur
31. Is it compulsory to pay bonus to all employees?
2. Who is eligible to get bonus?
3. What is the minimum & maximum %?
4. Please guide me on the entire calculation...
Regards,
Karthik P
From India, Thrissur
Hi Karthi,
Here are the points on payment and coverage of bonus under the act:
1. Coverage: Any employee who draws salary/wage (Basic+DA) less than Rs. 10000/- per month will now due to this amendment be covered as an employee under the Payment of Bonus Act 1965. (In past this limit was Rs. 3500/- per month (Basic+DA)
2. The percentage of bonus is a derived percentage from the method prescribed under the act (of calculating Gross Profit, Available Surplus and the Allocable Surplus and then the percentage of Bonus that can be paid.
3. The law stipulates that even when the company makes a loss, it is obliged to pay a bouns of 8.33% and whatever the profits the company cannot pay bonus exceeding 20% The first is called the Statutory Minimum Bonus and the other is called the statutory Maximum Bonus. Subject to other provisions of the act the percentage of bonus varies between these two levels.
4. The rule is that the calculated bonus is to be paid on the actual salary/wage (Basic+DA) upto (now) Rs. 3500/- (In past this limit was Rs. 2500/-) and the maximum salary/wage (Baisc+DA) on which bonus can be paid is Rs. 3500/- (In past this limit was Rs. 2500/-
5. Therefore if the calculated bonus was 20% then in past an employee drawing salary/wage between Rs. 2500/- and Rs. 3500/- per month would get Rs. 6000/- as Bonus (i.e. 2500*12*20%) and now he would get Rs. 8400/- under same conditions.
(i,e, 3500*12*20%)
6. A suitable provision shall be made in the books of accounts as on 31 March every year and get it paid with in a period of 9 month from the closure of the relevant financial year.
Regards,
Anurag Jain
From India, Jaipur
Here are the points on payment and coverage of bonus under the act:
1. Coverage: Any employee who draws salary/wage (Basic+DA) less than Rs. 10000/- per month will now due to this amendment be covered as an employee under the Payment of Bonus Act 1965. (In past this limit was Rs. 3500/- per month (Basic+DA)
2. The percentage of bonus is a derived percentage from the method prescribed under the act (of calculating Gross Profit, Available Surplus and the Allocable Surplus and then the percentage of Bonus that can be paid.
3. The law stipulates that even when the company makes a loss, it is obliged to pay a bouns of 8.33% and whatever the profits the company cannot pay bonus exceeding 20% The first is called the Statutory Minimum Bonus and the other is called the statutory Maximum Bonus. Subject to other provisions of the act the percentage of bonus varies between these two levels.
4. The rule is that the calculated bonus is to be paid on the actual salary/wage (Basic+DA) upto (now) Rs. 3500/- (In past this limit was Rs. 2500/-) and the maximum salary/wage (Baisc+DA) on which bonus can be paid is Rs. 3500/- (In past this limit was Rs. 2500/-
5. Therefore if the calculated bonus was 20% then in past an employee drawing salary/wage between Rs. 2500/- and Rs. 3500/- per month would get Rs. 6000/- as Bonus (i.e. 2500*12*20%) and now he would get Rs. 8400/- under same conditions.
(i,e, 3500*12*20%)
6. A suitable provision shall be made in the books of accounts as on 31 March every year and get it paid with in a period of 9 month from the closure of the relevant financial year.
Regards,
Anurag Jain
From India, Jaipur
Hi All,
I have few more queries about payment of Bonus:
From India, Mumbai
I have few more queries about payment of Bonus:
- Penalty of non payment of bonus is 6months imprisonment or fine up to 1000 as per the Act….is it the updated one?
- Which department is responsible for maintaining register or record for available or allocable surplus? Is it HR or Accounts?
- Is it acceptable if a company pays 8.33% of 3500 to employees who’s basic is less than 10,000 without maintaining any register or record for available or allocable surplus?
- Which Gov. Dept. can enquire for payment of Bonus? …Shops & Establishment Inspector? or Sales Tax Officer?
From India, Mumbai
Community Support and Knowledge-base on business, career and organisational prospects and issues - Register and Log In to CiteHR and post your query, download formats and be part of a fostered community of professionals.
Electronics & Information Technology Goods (Requirements for Compulsory Registration) Order, 201.pdf