The Payment of Bonus Act
Can anyone answer these questions?
1. Are there any rules under the POB Act for Karnataka, or do central rules apply to all States and UTs?
2. If it is calculated on gross, then OT, attendance allowance, and all allowances will be included.
3. If yes, then what if any month's salary exceeds 21k, and in that financial year, the salary will decrease?
4. Form D has to be submitted to the inspector before the 30th of December, am I right?
5. Forms A, B, and C have to be maintained in the organization, am I right?
6. Could you please tell me about Form C.
From India, Chennai
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Can anyone answer these questions?
1. Are there any rules under the POB Act for Karnataka, or do central rules apply to all States and UTs?
2. If it is calculated on gross, then OT, attendance allowance, and all allowances will be included.
3. If yes, then what if any month's salary exceeds 21k, and in that financial year, the salary will decrease?
4. Form D has to be submitted to the inspector before the 30th of December, am I right?
5. Forms A, B, and C have to be maintained in the organization, am I right?
6. Could you please tell me about Form C.
From India, Chennai
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Payment of Bonus Act is a Central Act and as such, it extends to the whole of India and applies to all factories without reference to the number of employees employed and to other establishments in which twenty or more employees are employed.
Bonus is paid to employees whose bonus qualifying wages do not exceed Rs 21,000 per month. If an employee's salary exceeds Rs 21,000 in the middle of a year, then his bonus should be calculated for the period during which his salary was less than Rs 21,000 only. Though Rs 21,000 is the cut-off limit for entitlement, the bonus is calculated on a salary of Rs 7,000 or the statutory minimum wages notified by the government. Therefore, even if the salary is Rs 21,000, the calculation will be on the presumption that the wages are Rs 7,000. If the establishment is included in the scheduled employment for which minimum wages have been fixed by the government, then that minimum wage should be the base for calculating the minimum wages.
The bonus qualifying salary normally includes Basic salary and Dearness allowance only. If you have a consolidated pay, the whole amount will qualify for a bonus. Overtime allowance paid will never form part of wages for bonus calculation.
For A, B, and C are various forms in which the profits, available surplus, and allocable surplus are shown. These have no practical use because the rate of bonus is always decided by the management and if there is a Union, in consultation with the Union. In such negotiations, these forms will not come into the picture because the Union will not accept it in practice!
Form D is to be sent to the Labour department for information.
From India, Kannur
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4761Bonus is paid to employees whose bonus qualifying wages do not exceed Rs 21,000 per month. If an employee's salary exceeds Rs 21,000 in the middle of a year, then his bonus should be calculated for the period during which his salary was less than Rs 21,000 only. Though Rs 21,000 is the cut-off limit for entitlement, the bonus is calculated on a salary of Rs 7,000 or the statutory minimum wages notified by the government. Therefore, even if the salary is Rs 21,000, the calculation will be on the presumption that the wages are Rs 7,000. If the establishment is included in the scheduled employment for which minimum wages have been fixed by the government, then that minimum wage should be the base for calculating the minimum wages.
The bonus qualifying salary normally includes Basic salary and Dearness allowance only. If you have a consolidated pay, the whole amount will qualify for a bonus. Overtime allowance paid will never form part of wages for bonus calculation.
For A, B, and C are various forms in which the profits, available surplus, and allocable surplus are shown. These have no practical use because the rate of bonus is always decided by the management and if there is a Union, in consultation with the Union. In such negotiations, these forms will not come into the picture because the Union will not accept it in practice!
Form D is to be sent to the Labour department for information.
From India, Kannur
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THE PAYMENT OF BONUS ACT.doc