Hi Friends, I want to know what is difference between Bonus & Ex-Gratia. Regards, Rajiv
From India, Chandigarh
Acknowledge(0)
Amend(0)
From India, Chandigarh
Acknowledge(0)Amend(0)
Bonus comes under the regulation of the Bonus Act, which you can find on Google. Ex-gratia is a concept to provide an extra amount for senior employees who are not eligible to receive a bonus as per the various provisions of the Bonus Act amended by the government.
From Singapore
Acknowledge(0)Amend(0)
28From Singapore
Acknowledge(0)Amend(0)
Bonus may be under the payment of Bonus Act, or it may be paid as a share in the profits. Bonus may also be paid as an incentive for performance or productivity and is often paid under an agreement, settlement, or award upon fulfilling eligibility norms. Ex-gratia is an amount paid by the employer out of his own volition, either in lieu of a bonus to those who do not fall under the eligibility norms, or as some monetary relief pending a settlement on an issue, etc.
B. Saikumar
HR & labor law advisor
Mumbai.
From India, Mumbai
Acknowledge(0)Amend(0)
B. Saikumar
HR & labor law advisor
Mumbai.
From India, Mumbai
Acknowledge(0)Amend(0)
Bonus under the Payment of Bonus Act will be paid as per the eligibility criteria of the employee, and the amount (%) of the bonus depends on the Allocable Surplus of the Company. In some cases, companies may link it to the production of the Company, which is called Productivity linked Bonus. Ex-gratia will be paid to the employees who are not eligible for a bonus under the Act.
Sometimes companies may pay statutory Bonus to the employees under the Act, and in addition to this, they may pay an Ex-gratia amount to them if there is any settlement with the Union to that effect.
D. Phani Kumar
DGM- HR
VASAVADATTA CEMENT
Sedam, Gulbarga Dist.
KARNATAKA
Acknowledge(0)Amend(0)
Sometimes companies may pay statutory Bonus to the employees under the Act, and in addition to this, they may pay an Ex-gratia amount to them if there is any settlement with the Union to that effect.
D. Phani Kumar
DGM- HR
VASAVADATTA CEMENT
Sedam, Gulbarga Dist.
KARNATAKA
Acknowledge(0)Amend(0)
Bonus refers to the statutory payment to be made to employees as per the Payment of Bonus Act, whereas Ex-Gratia is: (i) an additional bonus paid to those who are entitled to a bonus and (ii) payment in lieu of a bonus made to those employees who are not entitled to a bonus under the purview of the Payment of Bonus Act.
The amount of bonus calculated by applying the norms as per the Payment of Bonus Act will be far less than the amount generally expected by the employees. Therefore, a vast majority of companies declare a bonus of a higher amount after reaching an agreement with the Trade Unions for the payment of a specified percentage/amount. The difference between the actual amount of bonus paid over and above the amount calculated as per the Bonus Act is termed as Ex-Gratia.
S. Dass, DGM (Finance) Multitrack Engineering Pvt. Ltd.
From India, Bangalore
Acknowledge(0)Amend(0)
The amount of bonus calculated by applying the norms as per the Payment of Bonus Act will be far less than the amount generally expected by the employees. Therefore, a vast majority of companies declare a bonus of a higher amount after reaching an agreement with the Trade Unions for the payment of a specified percentage/amount. The difference between the actual amount of bonus paid over and above the amount calculated as per the Bonus Act is termed as Ex-Gratia.
S. Dass, DGM (Finance) Multitrack Engineering Pvt. Ltd.
From India, Bangalore
Acknowledge(0)Amend(0)
Dear friend,
A bonus is an annual payment that must be paid compulsorily to all eligible employees as per the Bonus Act. Ex-gratia is a payment that can be made by an employer to any employee, whether they are eligible for a bonus or not, at the employer's sole discretion. This means that an employee eligible for a bonus may receive both a bonus and ex-gratia, or just a bonus, while an employee not eligible for a bonus may or may not receive ex-gratia.
If the bonus is not paid, you can always claim it, but ex-gratia is not claimable.
Regards,
T. Chandran
From India, Kolkata
Acknowledge(0)Amend(0)
A bonus is an annual payment that must be paid compulsorily to all eligible employees as per the Bonus Act. Ex-gratia is a payment that can be made by an employer to any employee, whether they are eligible for a bonus or not, at the employer's sole discretion. This means that an employee eligible for a bonus may receive both a bonus and ex-gratia, or just a bonus, while an employee not eligible for a bonus may or may not receive ex-gratia.
If the bonus is not paid, you can always claim it, but ex-gratia is not claimable.
Regards,
T. Chandran
From India, Kolkata
Acknowledge(0)Amend(0)
Dear Chandran,
I am afraid it is not true that a bonus can only be claimed under the law and not ex-gratia. If ex-gratia is paid pursuant to a settlement or agreement, it too can be claimed in the appropriate forum. Even if it is not given under an agreement but solely due to discretion, it may still be claimed on grounds of discrimination if denied to any particular employee, depending upon the merits of the case.
B. Saikumar HR & Labour Law Advisor Mumbai
From India, Mumbai
Acknowledge(0)Amend(0)
I am afraid it is not true that a bonus can only be claimed under the law and not ex-gratia. If ex-gratia is paid pursuant to a settlement or agreement, it too can be claimed in the appropriate forum. Even if it is not given under an agreement but solely due to discretion, it may still be claimed on grounds of discrimination if denied to any particular employee, depending upon the merits of the case.
B. Saikumar HR & Labour Law Advisor Mumbai
From India, Mumbai
Acknowledge(0)Amend(0)
Dear Mr. Sai Kumar,
As you say, any payment, including ex-gratia, if covered under an agreement, is definitely payable. However, there are payments employers make to certain employees outside written agreements and at the sole discretion of the employer, for various reasons. Such payments are generally termed as "ex-gratia". These kinds of payments are generally made to all employees, but there can be willful omissions. These willfully omitted employees cannot legally claim such payment because it is paid only to selected employees.
Regards,
T. Chandran
From India, Kolkata
Acknowledge(0)Amend(0)
As you say, any payment, including ex-gratia, if covered under an agreement, is definitely payable. However, there are payments employers make to certain employees outside written agreements and at the sole discretion of the employer, for various reasons. Such payments are generally termed as "ex-gratia". These kinds of payments are generally made to all employees, but there can be willful omissions. These willfully omitted employees cannot legally claim such payment because it is paid only to selected employees.
Regards,
T. Chandran
From India, Kolkata
Acknowledge(0)Amend(0)
Dear Chandran,
I agree with you that ex gratia, which is paid by the employer of his own volition to specific employees as an individual contract, either written or implied, cannot be claimed by other employees. This is mostly true of the private sector.
B. Saikumar
Mumbai
From India, Mumbai
Acknowledge(0)Amend(0)
I agree with you that ex gratia, which is paid by the employer of his own volition to specific employees as an individual contract, either written or implied, cannot be claimed by other employees. This is mostly true of the private sector.
B. Saikumar
Mumbai
From India, Mumbai
Acknowledge(0)Amend(0)Looking for something specific? - Join & Be Part Of Our Community and get connected with the right people who can help. Our AI-powered platform provides real-time fact-checking, peer-reviewed insights, and a vast historical knowledge base to support your search.
Amendment to Payment of Bonus Act 2015.jpg
Bonus act amendment gazette copy.pdf
Bonus-amendment _206.doc