Bonus eligibility and formulas

Meaning: A bonus is an extra payment received as a reward for doing your job well. The bonus usually comes along with the salary of the employee.

Eligibility:
1. If Basic is below 21000/-, the employee is eligible for bonus pay.
2. If Basic is above 21000, the employee is not eligible for bonus pay.

Calculation:
1. If the organization has fewer than 20 employees, bonus pay is not mandatory.
2. Minimum Rate is 8.33% of Basic.
3. Maximum Rate is 20% of Basic.

Important points:
1. An employee who works for more than 30 days during a year is eligible for a bonus.
2. Any employee engaged in any type of work, including managerial, skilled or unskilled, is eligible for a bonus.
3. If an employee earns Rs.21000 or more per month, they are eligible for a bonus.