Payment of Bonus and Maintenance of Registers
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Initial Setup or Ongoing Maintenance
Ongoing compliance requirement
Filing and Maintenance Requirements
The provisions of the Payment of Bonus Act, 1965 (“Bonus Act”) applies to every establishment with 20 (twenty) or more employees. The employer is required to pay an employee a minimum of 8.33% (and up to a maximum of 20%) of the salary of the employee as bonus, each accounting year. The payment of bonus is subject to the concerned employee having worked in the establishment for more than 30 (thirty) days in the relevant accounting year. Under Rule 4 of the Payment of Bonus Rules, 1975 (“Bonus Rules”) every employer is required to maintain a register showing (a) allowable surplus in the format prescribed in Form A, (b) set-on and set-off of the allowable surplus in the format prescribed in Form B and (c) amount of bonus due to each employee in the format prescribed in Form C, which register may be called for by the concerned Inspector for inspection under Section 27 of the Bonus Act.
Under Rule 5 of the Bonus Rules, every employer is required to file a return in the format prescribed in Form D to the concerned Inspector so as to reach him within 30 (thirty) days from payment of bonus to the employees for an applicable accounting year
Section 28 of the Bonus Act provides that if any person contravenes any of the provisions of the Bonus Act or rules made there under, such persons is punishable with imprisonment for a term which may extend to 6 (Six) months or a fine which may extend to Rs. 1,000/- (Rupees One Thousand) or both.
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