Regarding Bonus Payment

Siva Rama Krishna (Querist) 11 March 2008 This query is : Resolved
I worked for a software company. While joining they mentioned that my bonus component is based on three factors.
1) Performance of the Company
2) My individual Performance
3) Duration of my stay during the year with the company.
I worked with that company for 7 months and I quit. Now they are not ready to pay me the bonus. They distributed the bonus to all other employees after I quit. As I am not on the payroll at the time of disbursement of bonus, they did not want to pay me. But it was not mentioned in the offer letter given to me. I sent a legal notice to them and they replied me stating that as per XXX act, I am not eligible for bonus as my salary is above statutory limit. If that is the case, they should not have mentioned the bonus component in my ofer. Please guide me on how to approach further.

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Prakash Yedhula (Expert) 15 March 2008
Limit of Rs.3500.00 was meant for extending the statutory benefits under Payment of Bonus Act,1965. So to call an employee eligible for statutory bonus under the act , his / her salary should not be of more than Rs.3500.00.(Presently Rs,.10,000) If there is increase in salary during the account year , the employee will be out of the preview of the statutory provisions from the date of such increase but at the same time he/she will be entitled to bonus for the period during the accounting year in which the salary was less than Rs.3500.00.(Rs.10,000 now)

Siva Rama Krishna (Querist) 16 March 2008
Dear Prakash,
Thanks for the reply. My salary at the time of joining the company is 1 lakh. Apart from that salary, company agreed to give bonus. As per the act, I am not eligible for the bonus. But company had agreed to give the bonus and I joined the company based on that agreement only. Otherwise I would have demanded them to include the bonus also with the salary component. Does not it look like cheating me by giving wrong promises and not fulfilling it now or avoiding it based on the Act?