New wage code bars bonus for those facing sex abuse charges- The Hindu -01/11/2020

Owing to a provision in the Code on Wages, those indulging in sexual harassment of any form could run the risk of losing out on bonus dues from their employers.

The Code on Wages lays down norms for annual bonus dues that accrue to employees, replacing the Payment of Bonus Act, 1965.
As per the extant law, bonus dues are barred only in case of employees dismissed for fraud, violent conduct and theft or sabotage.
The new Code includes ‘conviction for sexual harassment’ as a ground for denying bonus payouts to employees.


This a step forward towards creating seriousness towards instances of sexual harassment. The prospect of losing one’s benefits may make employees more careful of their conduct.

This is believed to be a great nudge to get people to be on their best behaviour in the workplace.
This would serve as an additional deterrent apart from the Prevention of Sexual Harassment (PoSH) law of 2013.

Prevention of Sexual Harassment (PoSH) law
As per the PoSH law guidelines, firms are required to form an Internal Complaints Committee (ICC) to inquire into complaints.

The Committee is required to make recommendations to employers on the action required pursuant to its inquiry in such complaints.

If the ICC upholds a complaint, it could be taken as a conviction.

Though not all sexual harassment cases translate into a police case, ICC has the power to decide if someone is guilty and report it further to the police.

Way forward:

The rules should clarify whether the conviction would cover cases of outcomes of the investigation by the ICC arriving at a conclusion to pay compensation to the victim or not.

It is not clear if sexual harassment incidents or related crimes against women outside the workplace could lead to dismissal of employees with loss of bonus payments. Harassing a co-worker irrespective of where it is done, should come under this provision’s purview.

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