LCI Learning

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More

Sourav Hajra (Director)     18 June 2013

Statutory bonus

Dear Members,

At our company, we had a practice of paying one month's salary as bonus to every employee. We had not been providing gratuity benefit to the employees. Now, since we want to get in line with the statute, in the interests of the employees we are planning to provide gratuity benefit to the employees.

 

Since we need to get the gratuity funds from somewhere, we decided to provide the employees with the minimum statutory bonus of Rs. 3500 per employee and transfer the remaining amount to the gratuity fund.

 

Now, the trade union who had been asking to provide the employees with gratuity benefit is refusing to accept lesser bonus amount and is pressurising us to provide the prevalent bonus. 

 

So if we reach at a stale mate (since we are trying to create standing orders) can we take up the case to the labor court? Does our case have a good chance?

 

Thanks and Regards,

Sourav



Learning

 3 Replies

tarun (Advocate)     18 June 2013

I would like you to go throught the relevant provisions of the Payment of Bonus Act  wherein  there are specific clauses which stipulate minimum as well maximum bonus needs to be given. Further there is also a forumla on basis of which such minimum and maximum bonus needs to be calculated. 

Moreover, Payment of Grautity Act also talk about the statutory liablity of the employer to pay the amount after completion of 5 years service  at prescribed formula.

 Both liabiities are statutory and independant of each other.

 

Sourav Hajra (Director)     18 June 2013

Thanks tarun,

I get the point of both acts being independent of each other. Payment of bonus act states that if any employee gets more than Rs. 3500 as his wage, his bonus calculation will be done keeping Rs. 3500 as his wage. I am attaching the ammendment of the act along with this mail. So if paying Rs. 3500 is statutory, any amount above stands as ex-gratia.

 

Please help me clarify.

Thanks


Attached File : 1030846088 bonus-ammendment.pdf downloaded: 155 times

VISHNU PROMOD SRIVASTAVA (ADVOCATE)     20 June 2013

U are right.


Leave a reply

Your are not logged in . Please login to post replies

Click here to Login / Register