Key points
- The Payment of Bonus (Amendment) Act, 2015 applies with effect from 1 April 2014.
- Eligibility: employees drawing salary/wages up to ₹21,000 per month are entitled to bonus.
- Calculation ceiling: bonus is calculated on ₹7,000 per month or the minimum wage fixed for the scheduled employment, whichever is higher.
- Rate: minimum 8.33% and maximum 20% of the salary/wage earned in the accounting year.
- Time limit: bonus is to be paid within 8 months from the close of the accounting year.
- Contract labour are also entitled to bonus; if the contractor fails to pay, the principal employer is responsible.
Example
For a DNH & DD unskilled worker, the minimum wage from 01-10-2026 is ₹513.50/day (≈ ₹13,351 for 26 days). As this is higher than ₹7,000, bonus is calculated on the applicable minimum wage, not on ₹7,000.
Note: The Code on Wages, 2019 consolidates the Payment of Bonus Act and the Minimum Wages Act. Employers should confirm the current position under the Code and its rules; contact us for an applicability review.
Signed by: Sandeep Kumar Singh, Collector, Daman.
⬇ Download official copy (PDF) Ask Phoenix about applicability
This is an explanatory summary prepared by Phoenix Worldwide for employers’ convenience. The official notification/circular issued by the Government is the only authoritative text. Please refer to the official copy and contact us for an applicability review for your establishment.