Government of Kerala issues guidelines to issue bonus to employees of public sector institutions

The Kerala Labour and Skills Department on August 14, 2020 has issued guidelines to issue bonus to employees of public sector institutions in Kerala. 

1. All public sector institutions must pay bonus to its employees according to the Amendments made in the Payment of Bonus Act. 8.33% minimum bonus must be paid to employees of companies where Government holds the majority of shares. Companies paying more than 8.33% bonus must ensure that they have completed the audit for revenue and expenditure calculation for the Financial Year 2019-20.

2. For any firm that has started production in the previous five accounting years, including 2019-20 may issue minimum bonus.

3. For firms that operated at a profit during the FY 2019-2020 must pay the Bonus as per the Payment of Bonus Act while ensuring that there is no violation of Section 11 of the Act prohibiting payment of more than 20% as bonus.

4. For firms operating at a loss continuously or on grants by the Government or budgetary support must limit the payment of bonus to the minimum payment of 8.33%.

5. For firms that suffered a loss in the FY 2019-20 must not issue bonus of more than 8.33%.

6. Only employees (not including apprentice) drawing salary of up to Rs. 24000 in public sector institutions may be paid bonus.

7. For workers engaged in Coir and Cashew industry, the bonus must be paid as per the decisions of the concerned committees.

8. For employees drawing salaries of more than 24,000 no other ex gratia payment or bonus must be paid other than festive bonus.

9. No public sector institutions, boards or cooperatives may do anything in violation of these orders.

10. If there is a need to deviate from any order, the same must be produced before the Government for review at least 15 days before Onam.

11. This order is applicable on all public sector initiatives under the State Government.

12. This order is applicable on all cooperatives involved in the production sector.

13. For other cooperatives special guidelines will be issued by the cooperative’s registrar.

14. Decisions taken on matters of bonus payment during the Tripartite Conference organized by the Labour minister must be implemented only after it receives the approval of the ministry. 

15. Any amount paid in contravention of these orders will be collected from the concerned public sector institution.

16. Ex gratia, performance linked incentive, festival gift, and any other names by which it might be known should all be made as per the order.

17. Ex gratia, performance linked incentive, festival gift given to public sector employees in 2019-20 must not be accounted for in 2018-19 audit.

18. If while determining bonus, the amount is lower than the previous year, the same amount paid during the previous year must be paid.

19. Bonus amount should not be higher than the amount paid in the previous year.

20. All new Ex gratia, performance linked incentive, festival gift issued must be according to 2019-20 Guidelines. 

[Order No. 67/2020/Labour]