1. This act applies to the whole of India (Including J&K)
2. The act applies to every factory and establishment
3. 20 or more persons should be employed
- Eligible Employee:-
1. Interns or Apprentice are excepted from this act
2. Salary(Basic+DA) should be up to Rs.21000/- p.m.
- Maximum & Minimum Bonus:-
1. Min. Bonus = 8.33% of Basic+DA, or Rs. 100, whichever is higher.
2. Max. Bonus = 20% of Basic+DA
(If in case the *Allocable surplus is more than 20% of Basic+DA, then the excess amount will be "Set on" with the next four years.)
- Time limit for bonus payment:-
1. Bonus shall be paid within 8 months from the closing of the accounting year
- Disqualification from Bonus
1. Fraud
2. Riotous or violent behavior on-premises
3. Theft, Misappropriating, or sabotage of company property
4. sexual harassment
* Notes:-
- Allocable surplus:-
The amount for Distribution of bonus is called Allocable surplus
1. For banking 60% of the Available surplus,
2. For all other establishments 67% of the Available surplus
- Available surplus = A + B:-
A = Gross Profit - Depreciation Admissible u/s 32 of the income tax Act - Development allowance - Direct taxes payable for the accounting year (calculated as per sec.7) - Sums specified in the third schedule.
B = Direct Taxes (calculated as per sec. 7) in respect of gross profits for the immediately preceding accounting year - Direct taxes in respect of such gross profits as reduced by the amount of bonus, for the immediately preceding accounting year.
- Set-on:-
When the allocable surplus exceeds the amount of the maximum bonus payable under section 11 then the excess shall, subject to a limit of 20% of the total salary or wage in that accounting year, can be carried forward for being set on in the succeeding accounting year and so on up to and inclusive of the fourth accounting year to be utilized for the purpose payment of bonus.
- Set-off:-
Vise versa of Set-on.
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