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.