Promulgated on May 26, 1965
Subsequently accepted by parliament and enacted in 1965
Main objectives are:
– To impose statutory obligation on the employer of every establishment defined in the act, to pay bonus to all eligible employees working in the establishment.
–To outline the principals of payment of bonus according to prescribed formula.
–To provide for payment of minimum and maximum bonus .
–To provide necessary machinery ,to enforce the payment of bonus.
Criteria for payment of bonus:
–Establishment wherein 20 or more workmen are employed on any day during an accounting period.
Every employee receiving salary or wages up to RS.3500.p.m.
Employee can be engaged in any type of work-skilled ,unskilled ,managerial, supervisory or manual.
Employee entitled to bonus if he has worked for at least 30 working days in the accounting year.
Sections under the act
Section 9:
Disqualification of the bonus:
An employee shall be disqualified from receiving bonus under this act if he is dismissed from service for:
–Fraud.
– Riotous or violent behavior while on the premises of the establishment.
–Theft, misappropriation or sabotage of any property of the establishment.
Section 10:
Payment of minimum bonus:
–Every employer is bound to pay to every employee a minimum bonus which shall be 8.33% of the salary or wage earned by the employee or-
–One hundred rupees ,whichever is higher even if the employer suffers losses during that accounting period.
–If an employee has not worked for all the working days in an accounting period , the bonus shall be proportionally reduced.
Section 11:
Payment of maximum bonus:
–Bonus should not exceed 20% of the salary or wages of the employees.
Section 12:
Calculation of bonus with respect to certain employees:
–When salary or wage of an employee exceeds RS. 1,600 ,the bonus shall be calculated as if his salary or wage were RS. 1,600
Section 13:Proportionate reduction in bonus in certain cases:
–When the employee has not worked for all the working days in an accounting year ,the minimum bonus of RS.100 ,if it is higher than 8.33% of his salary or wage for the days he has worked in that accounting year –
–Shall be proportionately reduced.
Subsequently accepted by parliament and enacted in 1965
Main objectives are:
– To impose statutory obligation on the employer of every establishment defined in the act, to pay bonus to all eligible employees working in the establishment.
–To outline the principals of payment of bonus according to prescribed formula.
–To provide for payment of minimum and maximum bonus .
–To provide necessary machinery ,to enforce the payment of bonus.
Criteria for payment of bonus:
–Establishment wherein 20 or more workmen are employed on any day during an accounting period.
Every employee receiving salary or wages up to RS.3500.p.m.
Employee can be engaged in any type of work-skilled ,unskilled ,managerial, supervisory or manual.
Employee entitled to bonus if he has worked for at least 30 working days in the accounting year.
Sections under the act
Section 9:
Disqualification of the bonus:
An employee shall be disqualified from receiving bonus under this act if he is dismissed from service for:
–Fraud.
– Riotous or violent behavior while on the premises of the establishment.
–Theft, misappropriation or sabotage of any property of the establishment.
Section 10:
Payment of minimum bonus:
–Every employer is bound to pay to every employee a minimum bonus which shall be 8.33% of the salary or wage earned by the employee or-
–One hundred rupees ,whichever is higher even if the employer suffers losses during that accounting period.
–If an employee has not worked for all the working days in an accounting period , the bonus shall be proportionally reduced.
Section 11:
Payment of maximum bonus:
–Bonus should not exceed 20% of the salary or wages of the employees.
Section 12:
Calculation of bonus with respect to certain employees:
–When salary or wage of an employee exceeds RS. 1,600 ,the bonus shall be calculated as if his salary or wage were RS. 1,600
Section 13:Proportionate reduction in bonus in certain cases:
–When the employee has not worked for all the working days in an accounting year ,the minimum bonus of RS.100 ,if it is higher than 8.33% of his salary or wage for the days he has worked in that accounting year –
–Shall be proportionately reduced.
