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DEAR ALL,

The payment of Bonus (amendment bill ,2015 received the assent of the President on the 31st December, 2015 and now becomes an ACT.

The payment of Bonus Act provides for the annual payment of bonus to employees of certain establishments (including factories and establishments employing 20 or more persons)

Earlier payment of bonus is required to be made to employees whose salary or wage is up to Rs 10000/- per month. As per new amendment eligible employee limit has been increased to Rs 21000/- per month.

Earlier the Act provides that the bonus payable to an employee will be in proportion to his or her salary or wage. However, if an employee’s salary is more than Rs 3,500 per month, for the purposes of calculation of bonus, the salary will be assumed to be Rs 3,500 per month. 

However after the new amendment the limit has been  raised and to Rs 7,000 per month or the minimum wage notified for the employment under the Minimum Wages Act, 1948 (whichever is higher).

Effective Date: Cabinet has approved the effective date on bill as 01.04.2015 , the bill was presented in lok sabha with effective date proposed as 01.04.2015 but as per lok sabha website, effective  date passed by Lok sabha is  01.04.2014 and same (effective date 01.04.2014) was also shown in gazette notification.

However in our view the date is wrongly published as 01.04.2014 while lok sabha has released the minutes of their proceedings and the same mistake is also carried forwarded in bill assented by the president.

So in our view effective date is 01.04.2015 and not 01.04.2014
Appropriate authority should issue a clarification on it.
Bill as proposed in parliament 

The Payment of Bonus (Amendment) Bill, 2015 

The Payment of Bonus (Amendment) Bill, 2015 was introduced in Lok Sabha by the Minister of State for Labour and Employment, Mr. Bandaru Dattatreya, on December 7, 2015. The Bill seeks to amend the Payment of Bonus Act, 1965. 

The Act provides for the annual payment of bonus to employees of certain establishments (including factories and establishments employing 20 or more persons). Under the Act, bonus is calculated on the basis of the employee’s salary and the profits of the establishment. 

Employees eligible for bonus: The Act mandates payment of bonus to employees’ whose salary or wage is up to Rs 10,000 per month. The Bill seeks to increase this eligibility limit to Rs 21,000 per month. 

Calculation of bonus: The Act provides that the bonus payable to an employee will be in proportion to his or her salary or wage. However, if an employee’s salary is more than Rs 3,500 per month, for the purposes of calculation of bonus, the salary will be assumed to be Rs 3,500 per month. The Bill seeks to raise this calculation ceiling to Rs 7,000 per month or the minimum wage notified for the employment under the Minimum Wages Act, 1948 (whichever is higher)

Prior publication of rules: The Act provides that the central government may make rules to implement its provisions. The Bill seeks to mandate prior publication of such rules in the Official Gazette to allow for more public consultation. 

Retrospective effect: The Bill will come into force on April 1, 2015.

Gazette Notification
MINISTRY OF LAW AND JUSTICE 
(Legislative Department) 

New Delhi, the 1st January, 2016/Pausha 11, 1937 (Saka) 

The following Act of Parliament received the assent of the President on the 31st December, 2015, and is hereby published for general information:—

THE PAYMENT OF BONUS (AMENDMENT) ACT, 2015 NO. 6 OF 2016 [31st December, 2015.] An Act further to amend the Payment of Bonus Act, 1965. BE it enacted by Parliament in the Sixty-sixth Year of the Republic of India as follows:— 

1. (1) This Act may be called the Payment of Bonus (Amendment) Act, 2015. 

(2) It shall be deemed to have come into force on the 1st day of April, 2014. 

2. In section 2 of the Payment of Bonus Act, 1965 (hereinafter referred to as the principal Act), in clause (13), for the words ‘‘ten thousand rupees’’, the words ‘‘twenty-one thousand rupees’’ shall be substituted. 3. In section 12 of the principal Act,— 

(i) for the words ‘‘three thousand and five hundred rupees’’ at both the places where they occur, the words ‘‘seven thousand rupees or the minimum wage for the scheduled employment, as fixed by the appropriate Government, whichever is higher’’ shall respectively be substituted; 

(ii) the following Explanation shall be inserted at the end, namely:—

‘Explanation.—For the purposes of this section, the expression ‘‘scheduled employment’’ shall have the same meaning as assigned to it in clause (g) of section 2 of the Minimum Wages Act, 1948.’. 4. In section 38 of the principal Act, for sub-section (1), the following sub-section shall be substituted, namely:— 

‘‘(1) The Central Government may, subject to the condition of previous publication, by notification in the Official Gazette, make rules to carry out the provisions of this Act.’’. 

DR. G. NARAYANA RAJU, Secretary to the Govt. of India.

http://www.egazette.nic.in/WriteReadData/2016/167383.pdf

Thanks & regards
Sandeep Jadhav
Email: sandeepjadhav.co@gmail.com

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