Entitlement to declared bonus on exit
Akash
(Querist) 22 April 2010
This query is : Resolved
A company declares bonus on April 30, 2010 and the bonus is payable in two parts (One with April 2010 Salary and other installement in September 2010). If an employee resigns on May 1, 2010 (with a notice period of one month), will he be entitled to the second intallement of bonus along with the full and final settlement?
Akash
(Querist) 22 April 2010
Dear Mr. Krishna
Can you help if there is a legal opinion/ court ruling on such issue?
Regards
Akash
H. S. Thukral
(Expert) 22 April 2010
As per Payment of Bonus Act, the bonus is payable within six month of closure of accounting year. e.g. Bonus for the year April 2009 to March 2010 is payable by September 2010. Only Pro rata bonus is payable to employees who don't work for full accounting year. You can calculate the payable bonus for the period he was in service during the year. He is definitely not entitled to full bonus.
Akash
(Querist) 22 April 2010
Dear Mr. Thukral
For the year April 2009 to March 2010, the employee was very much in service. Which means that he has worked for the complete accounting year. For this a/c year the bonus shall be declared on April 30, 2010. This shall be payable in two installments (one with April 2010 salary and next with september 2010 salary). The question is since he has already worked for the year in consideration and having resigned on may 1, 2010 and relieved in May 2010 itself, will his full and final settlement include the sept 2010 bonus installement? Please suggest.
Regards
Akash Singhvi
Akash
(Querist) 23 April 2010
Also does the position remain same in case the bonus is performance related (rest all facts remaining same)
H. S. Thukral
(Expert) 24 April 2010
Replied against Personal Message
