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Bonus Linked With Production Or Productivity
Under section 6 of The Act has laid down a detailed procedure for the calculation of amount payable as a bonus, to employees. First of all, Gross Profit calculates as per First or Second Schedule. From this Gross Profit, the sums deductible under Section 6 deductions take place. Thus, to this figure, we add the sum equal to the difference in the direct tax calculated on gross profit. Under section 31A, payment of bonus was linked with production or productivity with a special provision. Therefore bonus linked with production or productivity. Although anything contained in this Act:
- Where the employees entered an agreement or a settlement into with their employer. Before Payment of Bonus’ commencement (Amendment) Act, 1976.
- Where the employees enter into any agreement or settlement with their employer. For payment of an annual bonus linked with production or productivity after such commencement. In connection of bonus based on profits payable under this Act. Then, such employees shall get the entitlement for receiving the bonus. Under such agreement or settlement, the employees relinquishing their right to receive the minimum bonus under section 10. It purports to deprive them of such right due to any such agreement or settlement. Whereby it shall be null and void. As the case may be provided. It provided further that: such employees shall not have the entitlement to get paid such bonus. In excess of twenty per cent of their total salary or wage earned by them. During the relevant accounting year.
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