Skip to content

CS Executive · Setting Up of Business, Industrial and Labour Laws · The Code on Wages, 2019

A trust-run charitable hospital in Pune, established not for purposes of profit, employs 45 staff. A staff member claims that the bonus provisions of the Code on Wages, 2019 (the Chapter on bonus) apply to the hospital. Under the Code, what is the position?

The bonus Chapter does not apply to this hospital. Employees of hospitals and social welfare institutions established not for purposes of profit are expressly excluded, and the 20-employee threshold operates only subject to that exclusion, so having 45 staff does not change the result.

  1. AThe Chapter does not apply, because hospitals established not for purposes of profit are excludedCorrect
  2. BThe Chapter applies because the hospital has more than 20 employees
  3. CThe Chapter applies only if the hospital is registered as a company
  4. DThe Chapter applies only to the extent the State Government notifies it

Explanation

Section 41(1)(e)(iii) states that nothing in the Chapter applies to employees of institutions including hospitals, chambers of commerce and social welfare institutions established not for purposes of profit. The 20-employee rule in section 41(2) is expressly subject to sub-section (1), so headcount cannot bring the hospital back in.

Did you get it right without looking?

One question tells you little. A timed set on The Code on Wages, 2019 shows your real accuracy, how long you take and where you lose marks.

Practise The Code on Wages, 2019Free diagnostic mock

More The Code on Wages, 2019 questions