Mr. X was an employee of Naya International Co. with more than one-year continuous service. He was dismissed from services on account of insubordination. The Company refused to pay him bonus. Decide whether such person i

CS Professional · Labour Laws & Practice · PYQS · December 2021
Mr. X was an employee of Naya International Co. with more than one-year continuous service. He was dismissed from services on account of insubordination. The Company refused to pay him bonus. Decide whether such person is entitled to any bonus ? Also critically examine the disqualifications for payment of bonus.

Answer & Explanation:

Payment of Bonus Act, 1965 provides for the payment of bonus to persons employed in certain establishments and for matters connected therewith. Payment of Bonus Act extends to the whole of India, and as per Section 1(3) the Act shall apply to every factory; and every other establishment in which twenty or more persons are employed on any day during an accounting year. Every employee shall be entitled to be paid by his employer in an accounting year, bonus, in accordance with the provisions of this Act, provided he has worked in the establishment for not less than thirty working days in that year. According to Section 9 of the Payment of Bonus Act, an employee shall be disqualified from receiving bonus under this Act, if he is dismissed from service for: fraud; or riotous or violent behaviour while on the premises or the establishment; or theft, misappropriation or sabotage of any property of the establishment. If an employee is dismissed from service for any act of misconduct enumerated in Section 9, he stands disqualified from receiving any bonus under the Act, and not the bonus only for the accounting year in which the dismissal takes place [ Pandian Roadways Corpn. Ltd. v. Presiding Officer, Principal Labour Court, (1996) 2 LLJ 606 ]. Thus Mr. X is not entitled for bonus in the given case.

Topics: Payment of Bonus Act, 1965

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