Bonus - Doc Download

Hi,
Can anybody tell me the following
1. whether Bonus can be paid in monthly salary
2. what if the Salary of the employee is more than 10,000/-?
Regards
Preethi.

Dear Preethi,
Do check with the attachment for detailed information. Still have specific doubts, feel free to ping me...

Dear Preeti,
Bonus can't be paid monthly, coz its a yearly component paid to employee. But you can deduct bonus monthly from employees salary.
Also if an employees salary is above 10k you can pay him an annual bonus of 8400 i.i. 35oo*20%
Warm Regards
Sumiksha

Dear Maheesh,
With due respect to your answer I would like to submit as under:
According the attachment on Bonus Act the definition of 'employee' runs as under:
2(13) “employee” means any person (other than an apprentice) employed on a salary or wage not exceeding [three thousand and five hundred rupees] per mensem in any industry to do any skilled or unskilled manual, supervisory, managerial, administrative, technical or clerical work for hire or reward, whether the terms of employment be express or implied;
While the Govt. have already amended this section along with some other sections. Thus this attachment can not be stated to be updated.
Submitted only for information.
With Regards,
R.N.Khola

Dear Preethi,
1 Bonus can be paid in monthly salary as an component but in case it is a component of salary than it attract ESI and it called incentive bonus as Held by Hon'ble Bombay High court in case supra as Maharasthra Transport company's case.
2 And if the salary of the employee is more than Rs 10,000/-(basic+DA) then Bonus Act is not applicable on such employees.
Hope this satisfy your query.

Yes, Bonus can be paid only for those with salary slab equal or less than 10k per month and should be paid minimum of 8.33% of basic salary (includes DA) and maximum upto 20% of Basic.
Thanks
Arun Kumar Vijayamoorthy

1) Bonus can be paid monthly but it attracts ESI contributions. In any event the ENTIRE BONUS has to be paid before NOVEMBER of every year
2) Employees WAGES exceeding Rs.10,000/- are not covered by Bonus Act however, shall be paid as Ex-gratia.

Bonus can be paid monthly. But if there was a prevalent practice of payment of Annual Bonus or Customary Bonus, the same can only be changed to monthly basis only after a Notice under Sec. 9 A of the I.D. Act. Bonus year can be from April to March, Jan to Dec or any other practice prevalent of the mgmt. So there is no hard & fast rule that it should be paid before Nov. However, it must be paid within 8 months immediately after the Bonus Year so calculated. To avoid ESI contribution it is advisable to pay Bonus bi-monthly. Employees drawing wages more than Rs. 10,000 are not statutoriy eligible for Bonus. However, there is no bar for the employer to pay the same naming it either Bonus or ex-gratia. In such case the employer can calculate the Bonus Ceiling as per PB Amendment Act, 2007 as Rs. 3500/- only for the sake of his benefit. Regards.

Mr.Pradeep Mohanty,
correct me if i'm wrong....
Bonus Act says bonus must be paid within 8 months from close of accounting year means to paid before November, as a/c year closes on March and eigth month falls on November.

Thank u pradeep. Please can u enlight how it is possible to avoid ESI contribution by paying monthly bonus if u have any material or example please explain me.