What is the difference between a bonus and a bonus? This issue is of concern to many citizens of Russia, since the wording in the legislation is often very vague, and it is difficult for a person without a legal education to understand it. And graduates of law departments will have to smash their heads.
Salary
First of all, you need to understand what wages are. This term is usually called the form and mechanism of rewarding a person for the work done. The average citizen knows that his work can be paid according to the time or the amount of work actually done, and this is spelled out in the individual labor contract that the person concludes when hiring.
However, also any working citizen knows that almost all employers form wages from two indicators - salary and bonus, and sometimes mysterious “incentive payments” and “bonuses” are added to these lines in the payroll. And if everything is simple with the salary, then various bonuses and bonuses are perplexing. What it is? What is the difference between a bonus and a bonus? What determines the payment of these sums of money?
The concept of "premium"
In Russian legislation, all bonus pay is called bonus. Although there is no such legal term, the concept of bonus as part of remuneration for labor is also absent.
The term "premium" is. This is the name of the payment in any expression that the employee receives in addition to the main salary. It is understood that such an incentive is a reward - for improved quality indicators, for results, for achievements, etc.
In this case, the bonus can be considered part of the salary - in this case, it increases the amount of his average earnings, and the employer reflects this money as an expense that reduces profits, which reduces the amount of tax. In order to give the prize a legally significant form, the procedure and size of its payment must be prescribed in the regulations on bonuses and bonuses at the enterprise. Most often, this document is collective in nature, but sometimes such information is reflected only in the individual labor contract. Among other things, it is necessary to prescribe the indicators on which the payment or the amount of remuneration will depend, the system for evaluating these indicators, the formulas for calculating the amounts, the procedure for considering all of the above, and also determine the circle of employees who will be affected by this bonus system.
If this is not done, then the bonus will be considered a stimulating payment. In any case, it will be the employee’s income and will be reflected in the amount of income tax, but it will be more irregular and unsystematic in nature.
Types of Prizes
Depending on the classifying features, the prize is:
- Individual or collective. That is, the amount is paid either to one employee, or distributed to a team of employees. In the latter case, the bonus of each employee is proportional to his contribution to the common cause, and the size of the remuneration is determined by the head.
- According to the calculation formula. Two standard schemes are applied - a fixed amount or a percentage of profit or salary.
- By frequency. In our understanding, a bonus is a monthly reward. But it can also be quarterly, annual, semi-annual, or paid upon completion of a transaction or facility.
- For the intended purpose. Monetary remuneration can be accrued both for timely and impeccable performance of work duties, and for the performance of special individual or collective tasks.The former relate to stimulants, the latter to incentives.
- According to the normative document. There are bonuses paid according to the labor agreement or any other document of the internal documentation of the enterprise. But there are also rewards that are paid according to the individual decision of the management.
- By the type of line in the accounting report: 20 - line for the main employees, 26 - for managerial personnel, 84 - from retained earnings, etc.
We must not forget about special bonuses - for the anniversary of the employee or for a certain length of service, etc. Documentation for receiving bonuses is the employer's responsibility.
What is the difference between a bonus and a bonus? Now we already know that the award is a legal term, and there is no such thing as a bonus in the Labor Code of the Russian Federation. In order to find out the difference between a bonus and a bonus, you need to get acquainted with another term - incentive payments.
Incentive payments
In the legislation of the Russian Federation there are no easy and simple definitions. However, you can find information that incentive payments are called incentive bonuses and bonuses or other incentive rewards. Thus, the prize is a stimulating payment, more precisely, one of its types, which is more fully reflected in various legal documents.
What is a bonus?
So what is it and what is the difference between a bonus and a bonus? Let's get it right.
Bonus is also a stimulating payout. Like a bonus, a bonus can be expressed in cash or another equivalent. It is no secret that many enterprises offer highly qualified and rare specialists a flexible system of monetary and material incentives, for example, compensation for housing payments, provision of an official car for personal use or payment of gasoline, payment of vacation tickets for a holiday at the resort, and many more pleasant things.
With material goods, everything is clear - they are usually called bonuses. But what is the difference between a bonus and a bonus if both incentive payments are paid in cash? We will deal with this issue in more detail and compare these terms for the main indicators.
Periodicity
The main difference between the bonus and the bonus is the frequency of payments. The premium is a monthly indicator, sometimes also quarterly, semi-annual and annual. That is, this remuneration is paid regularly, according to the provision on bonuses, strictly according to the calendar schedule.
The bonus is most often awarded based on the results of a large reporting period - a quarter, six months or a year. In practice, the latter is more common, and there is an explanation for this. At the beginning of the year, enterprises are allocated money for expenses, and at the end, when the results are calculated, unspent profits and other funds, they can be spent including on the payment of a cash bonus. Sometimes such an incentive payment is not tied to the calendar at all, money is paid only upon the completion of a major transaction or object.
Legal framework
The legislation does not determine the size and nature of incentive payments. This is a private matter of the employer and his employees. But the concept of "premium" in the legislative documents of the Russian Federation is more fully disclosed, while the term "bonus" is absent. In addition, the size and payment of bonuses is often regulated by a special provision, and an employee of an enterprise can always calculate what and for what period he will receive. While the payment of bonuses depends on the wishes and capabilities of the employer.
Why give a bonus and why get a bonus
The payment of bonuses and bonuses should stimulate the employee to better fulfill his duties and increase labor productivity. But what are these rewards actually paid for? In order to understand this, it is necessary to pay attention to the etymology of words. The word "premium" comes from the Latin "premium" (first, ahead). Therefore, the prize is a well-deserved trophy for superiority, for achievements, for leadership in the process.Such a reward encourages you to do better, faster, and more, so as to always be the first.
Bonus is another concept. Such a monetary reward does not imply a competitive moment. It is paid to demonstrate respect and respect for employees and to thank them for their loyalty.
Formed opinion
According to the majority of citizens, the difference between a bonus and a bonus is as follows: the bonus is a monthly phenomenon, but the bonus is received irregularly, often based on the results of a large reporting period. Moreover, the bonus is considered to be an integral, although fluctuating, part of the salary, and the bonus is a pleasant, but not obligatory, one-time monetary addition to it. This point of view fully reflects the current state of affairs.
Also, many citizens believe that the main thing is that bonuses and bonuses to employees are paid in principle, and what they are called is completely unimportant.
Summary
Now the main differences between the bonus and the bonus are known. In addition, these two concepts often overlap. For example, an annual award or promotion in material terms can be called a bonus, and vice versa. In addition, employees are often pleased with other regular and irregular incentive payments. However, they do not replace each other and are used together, which further confuses the wage system.
The main thing that any working person should know is that any working conditions, including the size of salaries and incentive remuneration, should be spelled out in the employment contract. Moreover, the order and nature of incentive remuneration payments (bonuses) are often indicated in the collective provision on bonuses. These two documents will help to understand what should be the level of employee income for the selected period and at certain performance indicators.