Title
India Specific Bonus Calculations (HINCBON0)

Purpose
This function enables the calculation of employee bonus. This is anon-statutory report, which you can run for the payment of bonus.
Using the report, you can also compute bonus for ex-employees.

Precondition

• You must maintain the Organizational Assignment Infotype (0001),
Planned Working Time Infotype (0007) and Basic PayInfotype (0008).

• You must maintain the Evaluation Class 10 for all wage types,
which constitute in the Monthly Basis Salary for Bonuscalculation prior to the Bonus run.

• Payment wage type should be eligible for Additional Payments
Infotype (0015) or One-Time Payments Off-Cycle Infotype (0267)or both.

Features
This report calculates the bonus payable to an employee and generates abatch session. Running the batch session updates the AdditionalPayments Infotype (0015) or One-Time Payments Off-CycleInfotype (0267) or both.

Selection
You can restrict the employees selected to an individual, or arange of:


• Personnel number


• Personnel area, Subarea


• Employee group or subgroup


• Payroll area

The bonus calculation can be configured by:

• Bonus calculation period


• Basis salary for bonus, which can be an Annual Basis Salary, or
a Monthly Basis Salary.
Annual Basis Salary - The salary basis for bonus includes thewage types that you have entered in the Wage Type field. Thereport displays the Wage Type field only when you select theAnnual Salary Basis option. Bonus computations are typicallyperformed as per the Payment of Bonus Act (POBA). You however,have the option of also computing bonus in excess of the amountcomputed using POBA. Also, you can specify a maximum monthly basisamount to be considered while calculating the bonus.
Monthly Basis Salary - The salary basis for bonus includes allthe wage types that exist in the Basic Pay Infotype (0008) onthe specified Date of Basic salary, and having theEvaluation Class 10, Specification 1.

• Factor to calculate Bonus

For Annual Basis Salary computations, you must specify thefactor as a percentage, and the report computes the bonus as apercentage of the annual basis.
For Monthly Basis Salary, you must specify the factor as numberof months, and the report will compute the bonus in multiples of themonthly basis salary.
The payment information can be configured by:

• Wage type for storing the bonus amount in Additional Payments
Infotype (0015), One-Time Payments Off-Cycle Infotype (0267) orboth, depending on the type of payroll run. You can select the wagetype in the Wage type for IT0015/IT0267 field.

• Reason for bonus


• Bonus period and the type of payroll run, as the bonus can be paid
using both regular payroll or offcycle payroll runs

• If the bonus is paid according to the Bonus Act, select the As per
Payment of Bonus Act field. While computing the bonus as per POBA,the report checks the eligibility of the employee towards a bonus, on amonthly basis. Eligibility check is done on the nominal salary,represented by the Nom.ExGrat Base Lo limit Wage Type (/120).

• If you want to pay an amount exceeding the POBA amount, select the wage
type in the Wage type for amt exceeding POBA amount field.
The report in parallel computes the bonus amount as per the POBA, andthe bonus amount that is not as per the POBA. The system pays thedifference between the two values using the wage type that you haveselected in the Wage type for amt exceeding POBA amount field.

• If the employee is not eligible for a bonus as per the POBA, and you
still want to pay a bonus to the employee, you can enter an amount inthe Maximum monthly basis limit field. Any value that you enterin this field overrides the salary basis for determining employeebonus.

• If you want to pay an interim bonus to the employees, select the
Interim/Final Bonus field.
For example, your company decides to pay an interim bonus in August,for the period between April and March. In this case the report willproject the salary of August till March, and pay the bonus accordingly.If your company decides to pay a second interim bonus in October, theprojection for the second interim bonus will be based on the Octobersalary, and the system will deduct the first interim bonus from thepresent bonus.
While paying the Final bonus, the report will take the salary for theentire year as the annual basis, and deduct the previous interimbonuses paid to the employees. The system will also recover any excesspayments made during interim bonus.
The payment information for Ex-employees can be configured by:

• Selecting the Bonus for employee terminated during Bonus period
field, if applicable.
Additional information for terminated employees:
To specify a separate factor for calculating the bonus payable to exemployees, select Calculation rule for Ex-employee. Specify thefactor, in months, in the Bonus Calculation Factor field.
Limit on bonus can be specified by:

• High limit of Bonus, in case you want to put a limit on the
maximum amount that is payable as bonus. For example, you have enteredthe maximum limit as Rs. 10,000. In this case, even if the bonus amountpayable as per the other criteria exceeds Rs. 10,000, the employee willonly receive a bonus of Rs. 10,000.

• Low limit, in case you want to put a limit on the minimum amount
payable as bonus. For example, you have entered the minimum limit asRs. 1000. In this case, even if the bonus amount payable as per theother criteria is less that Rs. 1000, the employee will receive a bonusof Rs. 1000.

• Bonus paid as a fixed amount, that the report will add to the
computed Bonus
Bonus generation type:

• Batch input type/queue


• Test run, which is flagged to indicate a test run

Output


• The report creates a batch input folder for the Additional Payments
Infotype (0015) or One-Time Payments Off-Cycle Infotype(0267) or both, if you have not selected the Test Run option.The report also appends a time stamp to the name of the batch session.

• The report also creates an error list, if any.