Calculation of Bonus

Bonus is calculated on a salary of Rs. 2500 per month. Bonus is to be paid at a minimum of 8.33 per cent of the salary of the employee. The bonus is to be paid within eight months from the close of an accounting year. Maximum bonus can be paid at 20 per cent of the employee salary. To claim bonus the employee must have worked for 30 days in that year.

Linking Bonus to Productivity

Halsey Plan Total Earning = Time taken x Hourly Rate plus Bonus (bonus = 50 per cent of time saved) Rowan plan Unlike the Halsey Plan it takes into account a proportion as follows Time Saved \ time allowed x time taken x Hourly rate Total Earnings = Time Taken x hourly rate + Bonus