Fall 2005-01 Christmas bonus increased
Christmas bonus increased
Law No. 124 of September 29, 2005, amends the Bonus to Workers and Employees Act to increase the minimum Christmas bonus that private employers must pay to their employees.
The maximum bonus currently required by law is $200.00, but that will change come 2006.
Beginning in 2006
Law no.124 increases the bonus amount thrice during the next three years. However, the qualification period and the amount of hours that are to be taken into account to determine if an employee qualifies for the bonus were not altered.
The bonus will be computed on a percentage basis of a maximum of $10,000 earned by an employee during the prior fiscal year comprised between October 1 to September 30, and the total of all bonuses paid in a year need not exceed 15% of the net annual profit of the employer.
The new incremental changes will be as follows:
|Employers with 15 or More Employees|
|Employers with Less than 15 Employees|
An exemption is available for employers that cannot meet the new bonus standard by reason of insufficient profit to cover the same without exceeding the 15%. In such cases the bonus is reduced proportionately. In order to benefit from the exemption, an employer must file a written request with the Secretary of Labor and Human Resources of Puerto Rico no later than November 30 of each year, and submit its balance sheet and a profit and loss statement for the 12-month period from October 1 of the previous year to September 30 of the current year. The financial information must be certified by a certified public accountant. Failure to file the request timely will result in the employer having to pay the full amount mandated by the law.
© 2005 Goldman Antonetti