Wednesday, December 23, 2015

Bonus hike bill passed with effect from April 2014

Arrears of bonus (2014-15) likely !
The Lok Sabha on Tuesday passed a bill allowing doubling of wage ceiling for calculating bonus to Rs 7,000 per month for factory workers with establishments with 20 or more workers, with the benefits being applicable retrospectively from April 2014.
The Payment of Bonus (Amendment) Bill, 2015, was passed by a voice vote, with some members objecting to the raising of eligibility limit for payment of bonus from a salary of Rs 10,000 per month to Rs 21,000.

Replying to a debate on the legislation, Labour Minister Bandaru Dattatreya said the Government has ensured that the interest of workers are protected and there is no infringement on their rights.
"Because of Bihar Elections this bill got delayed... The Prime Minister spoke to me and asked why should the benefits of this Act should accrue to workers from 2015. It should be made available from the April 2014," he said while moving an official amendment to the Bill.
The official amendment provides that the benefits of the Act would be deemed to have come into force on April 1, 2014, instead of April 1, 2015. Dattatreya said the Ministry has held 21 tripartite meetings with all central trade unions while arriving at a decision.
The Bill provides for enhancing monthly bonus calculation ceiling to Rs 7,000 per month from the existing Rs 3,500. It also seeks to enhance the eligibility limit for payment of bonus from Rs 10,000 per month to Rs 21,000 per month.
"The Government's paramount intention is to safeguard the interest of workers... There is no infringement of workers' rights and whatever the government does will be in the interest of workers," Dattatreya said.
After the bill was passed, Deputy Speaker M Thambidurai, who was in the Chair, said the government should be congratulated for bringing the measure as also for effecting the benefits retrospectively. 
Terming the legislation as historic, Dattatreya said the outgo from government coffers would be about Rs 6,203 crore.
The Minister said the Bill would benefit crores of organised sector worker. He said unorganised sector constitute 93 per cent of the workforce or about 40 crore people.
Participating in the discussion, Mumtaz Sanghamita (TMC) said "it will benefit vast majority of poor workers. Bonus is the thing which is extra and over regular pay". She, however, wanted to know whether the increase in ceiling was commensurate to the inflation rate.
M Srinivas Rao (TDP) observed that labour laws in India were very weak and government should ensure safety and security for workers.
K Visheweshwar Reddy (TRS) said the sharp cut off of Rs 21,000 per month was flawed and added that contractual workers in factories are overworked and underpaid.
Sankar Prasad Datta (CPI-M) too echoed similar views saying that Rs 21,000 per month ceiling should not be there. Jaiprakash Narayan Yadav (SP) said there should be a special provision for women workers while providing bonus.
Prahlad Singh Patel (BJP) asked the government to fix a minimum ceiling and not the maximum one. "We can also think of linking it with the Pay Commission, so that we do not have to come again and again to Parliament to make changes". He said bonus should not be linked to profit or losses.
The Payment of Bonus Act, 1965, is applicable to every factory and other establishment in which 20 or more persons are employed on any day during an accounting year. The last amendment to the eligibility limit and the calculation ceiling was carried out in 2007 and made effective from April 1, 2006.
This amendment in the Act to increase wage ceiling and bonus calculation ceiling was one of the assurances given by the Centre after 10 day central trade unions went on one-day strike on September 2. 

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