Hi Everyone. I am the HR Manager from Malaysia and in charge of HR management in one of the companies located in Mumbai. I need some clarification on the Bonus Act. Our company pays 8.33% (as per the Bonus Act) bonus during the Diwali festival and a 20% performance bonus after the financial year, which ends in March every year. Recently, our employees have been requesting an increase in the 8.33% bonus, mentioning that other companies are paying more than 8.33%. I am conducting a survey on this and hope to receive feedback from HR professionals in India about the percentage paid by other companies. Thanks in advance.
Vijay
From Malaysia, Bayan Lepas
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Vijay
From Malaysia, Bayan Lepas
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Vijay,
Few questions:
1) What is the salary? Is it below 10,000/-?
2) Is your company in India less than 5 years old or has it completed 5 years?
3) Is your company making a profit (PAT)?
4) Are you allocating surplus in the accounts books?
Based on the answers, clarity can be provided.
Generally, the Bonus in India is paid as per the Bonus Act (Please do the research on Google), which is a minimum of 8.33% of basic salary (calculated on a maximum basic of 6500/- per month). The maximum can be 20%.
Performance bonus is a completely different component and should not be mixed with this bonus.
Regards,
From India, Pune
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124Few questions:
1) What is the salary? Is it below 10,000/-?
2) Is your company in India less than 5 years old or has it completed 5 years?
3) Is your company making a profit (PAT)?
4) Are you allocating surplus in the accounts books?
Based on the answers, clarity can be provided.
Generally, the Bonus in India is paid as per the Bonus Act (Please do the research on Google), which is a minimum of 8.33% of basic salary (calculated on a maximum basic of 6500/- per month). The maximum can be 20%.
Performance bonus is a completely different component and should not be mixed with this bonus.
Regards,
From India, Pune
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Hi Vinod,
Thanks for your reply. I really appreciate that. Yes, it is a manufacturing company based in Mumbai, India, focusing on profit and allocating surplus in accounts.
Our company pays an 8.33% bonus during the Diwali festival and another incentive bonus of up to 20% in March. Are we considered a better company compared to others because our employees are asking for an increase in the Diwali bonus (more than 8.33%)?
I hope this helps clarify any confusion. Let me know if you have any further questions.
From Malaysia, Bayan Lepas
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Thanks for your reply. I really appreciate that. Yes, it is a manufacturing company based in Mumbai, India, focusing on profit and allocating surplus in accounts.
Our company pays an 8.33% bonus during the Diwali festival and another incentive bonus of up to 20% in March. Are we considered a better company compared to others because our employees are asking for an increase in the Diwali bonus (more than 8.33%)?
I hope this helps clarify any confusion. Let me know if you have any further questions.
From Malaysia, Bayan Lepas
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Legally, you are correct, and there is no problem. If your management decides to pay more, it is your call. If your employees are demanding more, ask them to show the comparative figures and legal provisions on which their demands are based. In any case, you are paying them an additional amount by way of a Performance Bonus.
Thanks,
Kind Regards,
Avika Kapoor Vice President - Operations Website: Kapgrow
From India, New Delhi
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Thanks,
Kind Regards,
Avika Kapoor Vice President - Operations Website: Kapgrow
From India, New Delhi
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