Hello everyone,
I am new to this forum and recently started as an HR executive. This is my first company, and I am very new to factory issues. Now the problem is it's Diwali, and the labor of our organization is asking for a bonus. There are 7 laborers and 15 staff, out of which 10 have Basic+DA exceeding 10,000. For the remaining 5 staff members and 7 laborers, is it compulsory to give a bonus? Over the past two years, the company has been running at a loss.
Please, I need expert suggestions.
Santosh
From India, Mumbai
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6I am new to this forum and recently started as an HR executive. This is my first company, and I am very new to factory issues. Now the problem is it's Diwali, and the labor of our organization is asking for a bonus. There are 7 laborers and 15 staff, out of which 10 have Basic+DA exceeding 10,000. For the remaining 5 staff members and 7 laborers, is it compulsory to give a bonus? Over the past two years, the company has been running at a loss.
Please, I need expert suggestions.
Santosh
From India, Mumbai
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Dear Santosh,
Please note that even though the company is running at a loss, you must still pay the bonus. You can pay them the minimum bonus, which is 8.33% amounting to Rs. 3499 for the whole year. If the person is absent (not on leave) or joined after April 2011, then you can pay proportionately.
Thank you.
From India, Kumbakonam
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Please note that even though the company is running at a loss, you must still pay the bonus. You can pay them the minimum bonus, which is 8.33% amounting to Rs. 3499 for the whole year. If the person is absent (not on leave) or joined after April 2011, then you can pay proportionately.
Thank you.
From India, Kumbakonam
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Under the Payment of Bonus Act, a new factory does not have to pay a bonus for the first 5 years if they are not making a profit. From the next year onwards, they have to pay between 8.33% and 20% depending on the workings in the Allocable Surplus Register (the workings are given in the act very clearly). If you are making a loss, you still have to pay at least 8.33% of salary as a bonus. However, a bonus is not applicable for any employee with a salary above Rs. 10,000. For employees with a salary of less than Rs. 10,000 but above Rs. 3500, the bonus is computed as if the salary is Rs. 3500.
From India, Mumbai
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From India, Mumbai
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