Dear Team Please advise if a trainee can be eligible for Bonus? Is there any statutory obligation which says that Bonus amount has to be paid for Trainees? Regards Abhinav
From India, Chidambaram
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From India, Chidambaram
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Trainees are entitled to receive all statutory payments and contributions, including bonuses. There may be a designation called "Trainee," but you cannot label an employee as a trainee solely to withhold statutory contributions such as ESI, PF, welfare fund, and payments like wages at minimum rates fixed for each employment, bonus, gratuity, etc. However, apprentices engaged under the Apprentice Act are not eligible for bonuses.
Madhu.T.K
From India, Kannur
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4482Madhu.T.K
From India, Kannur
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Dear Abhinav,
I agree with my colleague Sh. TK Madhu that trainees appointed by the company are covered under the Payment of Bonus Act, 1965, provided they should be in receipt of a salary not exceeding Rs. 21,000 per month (revised w.e.f. 1-4-2014) and have worked for a minimum period of 30 days in a year. The bonus payable to them is to be calculated as if their salary or wage were Rs. 7,000.00 or the minimum wages for the scheduled employment, whichever is higher, per month. An employee receiving a salary or wage exceeding Rs. 21,000.00 per month is not entitled to receive a bonus under the Act.
BS Kalsi
Member since August 2011
From India, Mumbai
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I agree with my colleague Sh. TK Madhu that trainees appointed by the company are covered under the Payment of Bonus Act, 1965, provided they should be in receipt of a salary not exceeding Rs. 21,000 per month (revised w.e.f. 1-4-2014) and have worked for a minimum period of 30 days in a year. The bonus payable to them is to be calculated as if their salary or wage were Rs. 7,000.00 or the minimum wages for the scheduled employment, whichever is higher, per month. An employee receiving a salary or wage exceeding Rs. 21,000.00 per month is not entitled to receive a bonus under the Act.
BS Kalsi
Member since August 2011
From India, Mumbai
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Yes you have to pay bonus to trainees until you are able to justify them apprentice as per apprentice act. Ie stipend pay, course sylebus, apprentice board approval.
From India, Kolkata
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From India, Kolkata
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Dear All,
Trainees are not entitled to Bonus, PF, and Minimum wages.
The definition of "employee" as per Section 2 (13) of the Payment of Bonus Act, 1965 (please see attachment) clearly and specifically excludes "apprentices." In most companies, to differentiate between Act Apprentices (under the Apprentices Act, 1961) and Company Apprentices (as per Company's Standing Orders), apprentices directly recruited and trained in various trades/activities are called "Trainees."
The Supreme Court, many High Courts, and the PF Appellate Tribunal have clearly held that Trainees/Apprentices are excluded from the definition of "employee" for PF benefits as per Section 2 (f) of the EPF & MP Act, 1952 (please go through the attachments).
Trainees/Apprentices are only paid a consolidated stipend, and only very few State Governments have notified Minimum wages for Apprentices as well. Unless there is a specific notification for the payment of minimum wages for Apprentices by the appropriate Government, Trainees/Apprentices need not be paid minimum wages.
Regards,
N. Nataraajhan, Sakthi Management Services (Hp: +919483517402; e-mail: natraj@sakthimanagement.com)
From India, Bangalore
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Trainees are not entitled to Bonus, PF, and Minimum wages.
The definition of "employee" as per Section 2 (13) of the Payment of Bonus Act, 1965 (please see attachment) clearly and specifically excludes "apprentices." In most companies, to differentiate between Act Apprentices (under the Apprentices Act, 1961) and Company Apprentices (as per Company's Standing Orders), apprentices directly recruited and trained in various trades/activities are called "Trainees."
The Supreme Court, many High Courts, and the PF Appellate Tribunal have clearly held that Trainees/Apprentices are excluded from the definition of "employee" for PF benefits as per Section 2 (f) of the EPF & MP Act, 1952 (please go through the attachments).
Trainees/Apprentices are only paid a consolidated stipend, and only very few State Governments have notified Minimum wages for Apprentices as well. Unless there is a specific notification for the payment of minimum wages for Apprentices by the appropriate Government, Trainees/Apprentices need not be paid minimum wages.
Regards,
N. Nataraajhan, Sakthi Management Services (Hp: +919483517402; e-mail: natraj@sakthimanagement.com)
From India, Bangalore
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Only apprentices under Apprentices Act 1961 can be excluded from Bonus Act,gratuity Act ESI Act etc .Trainees under App Act and under Standing Orders of the Company are exempted from EPF Act.
From India, Thiruvananthapuram
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From India, Thiruvananthapuram
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Any employee, apart from an apprentice, who has been recruited for a specific job as a fresher, where training or skills need to be imparted, is hired as a trainee. However, all statutory norms have to be followed, and the employee is also eligible for bonuses.
From India, Ahmadabad
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From India, Ahmadabad
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Dear Sirs,
I have a disagreement on the above point. As per the definition of an employee under the EPF Act, two categories of apprentices are excluded: one is trainees under the Apprentice Act, and the other is trainees engaged under the provisions of certified standing orders. There are a number of case laws, including a recent one from the EPF Appellate Tribunal, that uphold the exclusion of trainees from employees and hence the need not deduct EPF.
From India, Coimbatore
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I have a disagreement on the above point. As per the definition of an employee under the EPF Act, two categories of apprentices are excluded: one is trainees under the Apprentice Act, and the other is trainees engaged under the provisions of certified standing orders. There are a number of case laws, including a recent one from the EPF Appellate Tribunal, that uphold the exclusion of trainees from employees and hence the need not deduct EPF.
From India, Coimbatore
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As Bonus Act has excluded the Apprentice from the Act, But not Defined the Definition of The Apprentice in the act, On need to see other Act reference for the same in this case we may refer 2 places
1. Apprentice Act : Says in Definition of Apprentice as "Trainee or Learner are apprentice" and if you say trainees are coming into this preview than they also come under Apprentice act all the relevant rule as defined in Apprentice is Applicable to those trainees also ie. Stipend, course syllabus, apprentice board approval etc.
So in this case, If Trainees are followed all the Procedure as per Apprentice act you can deprive them of Bonus.
2. Standing Order : This also has the same definition similar to Apprentice act Definition, An “apprentice” is a learner who is paid an allowance during the period of his training.
Means if employee is paid stipend allowance we can deprive them of Bonus
From India, Kolkata
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1. Apprentice Act : Says in Definition of Apprentice as "Trainee or Learner are apprentice" and if you say trainees are coming into this preview than they also come under Apprentice act all the relevant rule as defined in Apprentice is Applicable to those trainees also ie. Stipend, course syllabus, apprentice board approval etc.
So in this case, If Trainees are followed all the Procedure as per Apprentice act you can deprive them of Bonus.
2. Standing Order : This also has the same definition similar to Apprentice act Definition, An “apprentice” is a learner who is paid an allowance during the period of his training.
Means if employee is paid stipend allowance we can deprive them of Bonus
From India, Kolkata
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Trainee by designation is just like an employee. If you have facilities to impart training, engage apprentices following the Apprentice Act. Otherwise, you should have a training scheme as per your own certified Standing Order approved by the Labour Department and engage trainees accordingly. All other kinds of engagement will be, or should be, deemed as an attempt to deprive them of the rights under Labour Laws. If you go through the various Acts and the interpretations given by various Courts, you will come to know that neither the Acts nor the verdicts direct the employers to give trainees a clean permission to hire and pay them remuneration as desired. If they are really engaged to provide training, let us follow the available act, i.e., the Apprentice Act. At the same time, if they are hired to work with the same timing as applicable to other workers, facing the same hardships, etc., then pay them at least the minimum wages and all other statutory payments, including bonus.
Madhu.T.K
From India, Kannur
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Madhu.T.K
From India, Kannur
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Position regarding Jurisdiction of Civil Court vis-a-vis adjudication of rights and obligations .pdf
Amendment to Payment of Bonus Act 2015.jpg
PF Judgement - SC - Trainee - 2006.doc