Anirban Chatterjee 08 September 2019

Bonus

My brother working in a company as a accounts cleark under high skilled category. He is getting Rs.17500.00 net, after cutting PF and ESI. His gross salary is Rs. 20,000.00. Last few years company is giving bonus only Rs. 7,000.00 for all like unskilled, skilled and high skilled category. Some other Companies are giving one month salary to their employees.What is the rule for bonus, please clarify and guide me.

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Rama chary Rachakonda (Secunderabad/Highcourt practice watsapp no.9989324294 ) 09 September 2019

Maximum bonus limit increased to 20% of Rs. 7000

Earlier, the maximum statutory bonus that could be paid out was 20% of Rs. 3500. However, this has been changed to 20% of Rs. 7,000 (or minimum wages, whichever is higher). This gives companies a chance to allot a greater portion of employees’ CTCs towards bonuses.

3. Minimum Bonus increased to 8.33% of Rs 7,000

Before the amendment, the minimum that could be paid to employee under the bonus act was Rs. 292 (8.33% of 3,500). However, this amount has been doubled to become Rs. 583( or 8.33% of the minimum wages, whichever is higher) . Since, companies are expected to pay all arrears since 2014, this particular change seems to be causing the highest discomfort for employers. In states where the minimum wage is higher than Rs 7,000, the statutory arrears liability becomes even higher.