New Delhi, Oct 29: Employers' association AIOE has asked the government to defer the implementation of amendments in the Payment of Bonus Act to next fiscal so as to reduce financial burden on the industry, particularly small and medium businesses.
Keeping in view both the financial and operational hardships facing the industry, All India Organisation of Employers (AIOE), an allied body of business chamber Ficci, has requested the government to apply the amended legislation prospectively -- from financial year 2016-17.
AIOE said in a statement that the applicability of enhanced bonus from April 1, 2015 is fraught with serious financial implications for the Indian industry, particularly the Medium, Small and Micro Enterprises sector.
President of AIOE Sanjay Bhatia has written to Labour Secretary Shankar Aggarwal for deferring the implementation. The amendment bill seeks to enhancing limit of coverage for payment of bonus from the existing wage limit of Rs 10,000 to Rs 21,000 per month as well as the calculation limit for payment of bonus from Rs 3,500 to Rs 7,000 per month.
In the letter, Bhatia pointed out that apart from the burden of financial implications on the MSME sector, industries will face serious functional problems as the enhanced amount of bonus has not been provided for in the balance-sheet/accounts statement of the previous year i.e. 2014-15, which ended on March 31, 2015.
"Since, the allocable surplus for payment of bonus is calculated during the preceding accounting year, out of which bonus is paid in the succeeding financial year, the payable bonus already stands allocated for the present accounting year ending March 31, 2015," the AIOE said .
Moreover, many industries have already paid bonus to their employees, at the existing rate, before the start of the festival session, it said.
The implementation of this proposal effective April 1, 2015 will therefore cause great inconvenience to industries in reallocating the bonus amount retrospectively causing financial and operational hardships, it added.