How much bonus to give employee in india

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(14) “employer includes-(i)in relation to an establishment which is a factory, the owner or occupier of the factory, including the agent of such owner or occupier, the legal representative of a deceased owner or occupier and where a person has been named as a manager of the factory under clause (f) of sub-section (1) of section 7 of the Factories Act, 1948 (63 of 1948), the person so named; and(ii)in relation to any other establishment, the person who, or the authority which, has the ultimate control over the affairs of the establishment and where the said affairs are entrusted to a manager, managing director or managing agent, such manager, managing director or managing agent; (15) “establishment in private sector” means any establishment other than an establishment in public sector; (16) “establishment in public sector” means an establishment owned, controlled or managed by-(a) a Government company as defined in section 617 of the Companies Act, 1956 (1 of 1956);(b) a corporation in which not less than forty per cent of its capital is held (whether singly or taken together) by-(i) the Government; or(ii) the Reserve Bank of India; or(iii) a corporation owned by the Government or the Reserve Bank of India; (17) “factory” shall have the same meaning as in clause (m) of section 2 of the Factories Act, 1948 (63 of 1948); (18) “gross profits” means the gross profits calculated under section 4; (19) “Income-tax Act” means the Income-tax Act, 1961 (43 of 1961); TOP (20) “prescribed” means prescribed by rules made under this Act; (21) “salary or wage” means all remuneration (other than remuneration in respect of over-time work) capable of being expressed in terms of money, which would, if the terms of employment, express or implied, were fulfilled, be payable to an employee in respect of his employment or of work done in such employment and includes dearness allowance (that is to say, all cash payments, by whatever name called, paid to an employee on account of a rise in the cost of living), but does not include-(i)any other allowance which the employee is for the time being entitled to; (ii)The value of any house accommodation or of supply of light, water, medical attendance or other amenity or of any service or of any concessional supply of food grains or other articles;(iii)any travelling concession;(iv) any bonus (including incentive, production and attendance bonus);(v) any contribution paid or payable by the employer to any pension fund or provident fund or for the benefit of the employee under any law for the being in force;(vi)any retrenchment compensation or any gratuity or other retirement benefit payable to the employee or any ex gratia payment made to him;(vii) any commission payable to the employee. Explanation.-Where an employee is given in lieu of the whole or part of the salary or wage payable to him, free food allowance or free food by his employer, such food allowance or the value of such food shall, for the purpose of this clause, be deemed to form part of the salary or wage of such employee; (22) words and expressions used but not defined in this Act and defined in the Industrial Disputes Act, 1947 (14 of 1947), shall have the meanings respectively assigned to them in that Act. TOPCOMMENTS (i) Employees of State Boards are entitled to bonus. [Orissa State Housing Board v. D.Nayak & Ors., (1989) 2 L.L.N. 241 (Ori.)].(ii)A co-operative bank is a banking company. [Vellore Central Co-op. Bank Ud. v. Industrial Tribunal, (1989) 58 F.L.R. 924 (Mad.)].(iii)Lay-off compensation is included in the terin of “salary” or “wages”. [Mohan Kumar v. Deputy Labour Commissioner, (1991) 62F.L.R. 903 (Ker.)].(iv)When wages are revised, the management has to pay bonus on arrears. [Mumbai Kamgar Union v. Indian Tool Mfrs. Ltd. & Ors., (1981) 1 L.L.N. 391 (Born.)].(v) Dearness allowance and city compensatory allowance are included in the definition of “salary” or “wages” under section 2 (21) of the Act. [S. Krishnamurthy v. Presiding Officer, Labour Court. (1986) 55 F.L.R. 535]. TOP COMMENTS(i) Local bodies do not come within the purview of this Act. [Union of India & Ors. v. R.C. fain & Ors., A.I.R. 1981 S.C. 951].(ii) Institutions such as hospitals, social welfare institutions and chambers of commerce are intended to be exempted under section 32(v)(c). [Maharashtra Electricity Board v. M.c. Chitale, (1981) 1 L.L.J. 162 (Born.) D.B.].(iii) It is not every type of institutions (including a statutory corporation) which can be exempted. [ibid.].(iv) This Act is not applicable to agents of State Governments. [Maharashtra State Co-op. M.arketing Federation Ltd. v. 1st Labour Court (1988) 57 F.L.R. 301 (Born.)].(v) A society established for the purpose of making profit is not excepted under this Act. [ibid.].(VI) Institutions designed for earning profit should pay the minimum bonus to their employees. [T.N. Water Supply & Drainage Board Engineers’ Association v. Government of T.N. etc., (1991) 2 L.L.J. 394 (Mad.)]

Current Size: 100% 33. [Act to apply to certain pending disputes regarding payment of bonus.] Rep. by the Payment of Bonus (Amendment) Act, 1976 (23 of 1976), s. 21 (w.e.f. 25-9-1975). 34. Effect of laws and agreements inconsistent with the Act.-Subject to the provisions of section 31A, the provisions of this Act shall have effect notwithstanding anything inconsistent contained in any other law for the time being in force or in the terms of any award, agreement, settlement or contract of service. 35. Saving.-Nothing contained in this Act shall be deemed to affect the provisions of the Coal Mines Provident Fund and Bonus Schemes Act, 1948 (46 of 1948), or of any scheme made thereunder. 36. Power of exemption.-If the appropriate Government, having regard to the financial position and other relevant circumstances of any establishment or class of establishments, is of opinion that it will not be in public interest to apply all or any of the provisions of this Act thereto, it may, by notification in the Official Gazette, exempt for such period as may be specified therein and subject to such conditions as it may think fit to impose, such establishment or class of establishments from all or any of the provisions of this Act. COMMENTS (i) Before according exemption under section 36 to an establishment, its employees should be heard. [State of T.N. v. K. Sabansyagam & T.N.S.H.B., (1989) 1 L.L.N. 955 (Mad.)]. (ii) Exemption cannot be granted with retrospective effect. [ibid.]. (iii) For granting exemption to any establishment, the Government has to pass a speaking order. [National Dairy Development Board v. National Dairy Development Employees’ Union. (1986) 2 L.L.N.148]. TOP(iv) Exemption applies to branches, etc. [Alloy Steel Project v. The Workmen (1971) 1 S.C.C. 536]. (v) The appropriate government must consider relevant factors before it chooses to accord exemption. [T.N. State Housing Board v. K. Sabanayagam, (1990) 61 F.L.R. 60 (Summary) (Mad.)]. 37. [Power to remove difficulties.] Rep. by the Payment of Bonus (Amendment) Act, 1976 (23 of 1976), 5.23 (w.e.f. 25-9-1975). TOP

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