Wednesday 22 May 2013

THE PAYMENT OF BONUS ACT, 1965

What does BONUS mean?

Something given in Addition to what is ordinarily received by or strictly due to the recipient .
It is a kind of GRATUITY to the workmen beyond their wages.

Applicability of the Act:
Sec 1(2) defines the applicability to whole of INDIA.
Sec 1(3) it is applicable to:
- every factory
- every other establishment in which Twenty or more persons are employed on any day during an accounting year( 1st April to 31st March)

Section 32 of the Act explains the non applicability:

The Act is not applicable to the following classes of employees:

1. a) Employees employed by insurer carrying any general insurance business
    b) Employees employed by the Life Insurance Corporation of India.

2. SEAMEN- according to section 3 of Merchant Shipping Act, 1958

3. Employees registered under the scheme of Dock Workers\

4. Employees of any Industry called under the scheme of Central Government or State Government.

5. Employees of The Reserve Bank of India.

6. a)Employees under Red Cross Society, Universities and educational Institutions.
   b)Institutions( Hospitals, Chamber of Commerce and social welfare institutions) established not for Profit purpose.





What are different kinds of BONUS?

a) Profit based bonus
b) Customary bonus and,
c) Attendance bonus

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