ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Workers Share

Vol XI No 40 October 2, 1976 Skylark 284 Frera Road Bombay 400 038 Grams Econweekly Editor Krishna Raj Associate Editor Rajani X Desai Assistant Editor M S Prabhakar Editorial Staff Colin de Souza, K Vijayakumar Manager J K Thakkar Advertisement Manager R Venkiteswaran Workers' Share A VERY large proportion of the industrial working class will cither not get the traditional annual Divali-eve bonus payment this year or will get much smaller 'sums than in the past. It is ironical that this should happen in a year when the rise in industrial production is claimed to have been of a record order. Employers are fond of preaching that the earnings of labour should he linked to production and productivity. It would appear, however, that the contribution of workers to the increase in production in the last year will go unrequited. , This .situation has come about as a result of the amendment of the Bonus last year. Following the amendment, beginning from this year workers will not be entitled to payment of a minimum bonus which, it will be recalled, used to be 8.33 per cent. Even last year a minimum bonus of 4 per cent was paid. Under the amended Act. bonus is payable according to the availability of "allocable surplus' as defined in the Act. The 'allocable surplus' is to be calculated by deducting from after-tax profits return on capital at 8.5 per cent on paid-up capital and 6 per cent on reserves. Thus a company with substantial after-tax profits may still have no 'allocable surplus' and so may not be liable to pay any bonus to its workers. Yet the same company, if its paid up capital to reserves ratio is 1 : 2, will be able to pay a dividend of 20 per cent to shareholders. Under the amended Bonus Act, therefore, even companies which make good profits and which declare fairly high rates of dividend to shareholders will be able to avoid payment of bonus to workers. What is more the 'allocable surplus' is to be calculated not on the basis of the company's working in the year to which the demand for payment of bonus relates, but in the last lour years

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