Tata Steel has made a provision of Rs 171 crore for paying annual bonus to its 30,155 employees for 2010-11 even though none of them is legally eligible for receiving it according to the established norms.
“Since all employees of the steel company are drawing salary/wages higher than the limit laid down in the Payment of Bonus Act, 1965, no employee of the company is eligible for bonus under the Act. However, respecting our old traditions, the company is going to pay bonus to all employees in the Unionised category,” the company said in a press release on Thursday.
The Memorandum of Settlement on the bonus was signed by Mr H.M. Nerurkar, Managing Director, Tata Steel; Mr A.M. Misra, Vice-President (Coke, Sinter and Iron & Industrial Relations) and other senior officials on behalf of the company's management and Mr Raghunath Pandey, President, Tata Workers' Union and the other office bearers, on behalf of the Union, in the presence of Mr Akhilesh Kumar, Conciliation Officer and Deputy Labour Commissioner, Jamshedpur.
The annual bonus is 18.50 per cent of salary/wages (Basic + DA), taking into account the amount of salary/wages of arrears of wage revision paid/payable, as the case may be, for the accounting year 2010-11, the company said.