The Payment of Bonus Act, 1965 is enacted to provide for the payment of statutory bonus to persons employed in certain establishments on the basis of profits or on the basis of production or productivity and for matters connected therewith. The Act also provides for minimum bonus and maximum bonus payable to the eligible employees.

 APPLICABILITY

The Act is applicable to:

•     Every factory where in 10 or more persons are employed with the aid of power; or
•     Establishment in which 20 or more persons are employed without the aid of power on any    

    day during  an accounting year (Section 1)

 ESTABLISHMENT

Establishments includes Departments, undertakings and branches etc

 ELIGIBILITY

•       Employees drawing wages up to ( before amendment - Rs 10000) after amendment Rs   

                     21000 per month

•      Minimum Bonus is 8.33% of the Salary
•      Maximum Bonus id 20% of the Salary
•      CAP for calculating bonus (before amendment - Rs 3500 per month) after amendment Rs   

     7000 per month or the rate of minimum wages, whichever is higher

•    An employee will be entitled to get bonus only when he has worked for not less than 30   working days in the relevant accounting year

 TIME LIMIT FOR PAYMENT OF BONUS

•      Within 8 months from the closing of the accounting year
•       If disputed then within 1 month from the date on which award becomes enforceable