Press Trust of India | New Delhi December 22, 2015 Last Updated at 19:14 IST

The Lok Sabha today passed a bill allowing doubling of wage ceiling for calculating bonus to Rs 7,000 per month for factory workers with establishments with 20 or more workers, with the benefits being applicable retrospectively from April 2014.

The Payment of Bonus (Amendment) Bill, 2015, was passed by a voice vote, with some members objecting to the raising of eligibility limit for payment of bonus from a salary of Rs 10,000 per month to Rs 21,000.

Replying to a debate on the legislation, Labour Minister Bandaru Dattatreya said the Government has ensured that the interest of workers are protected and there is no infringement on their rights.

"Because of Bihar Elections this bill got delayed... The Prime Minister spoke to me and asked why should the benefits of this Act should accrue to workers from 2015. It should be made available from the April 2014," he said while moving an official amendment to the Bill.

The official amendment provides that the benefits of the Act would be deemed to have come into force on April 1, 2014, instead of April 1, 2015.

Dattatreya said the Ministry has held 21 tripartite meetings with all central trade unions while arriving at a decision.

The Bill provides for enhancing monthly bonus calculation ceiling to Rs 7,000 per month from the existing Rs 3,500. It also seeks to enhance the eligibility limit for payment of bonus from Rs 10,000 per month to Rs 21,000 per month.

"The Government's paramount intention is to safeguard the interest of workers... There is no infringement of workers' rights and whatever the government does will be in the interest of workers," Dattatreya said.

After the bill was passed, Deputy Speaker M Thambidurai, who was in the Chair, said the government should be congratulated for bringing the measure as also for effecting the benefits retrospectively.

From India, Bangalore
Assistant Manager Human Resources
Sr.manager - Hr & Ir
Statutory Compliance
+1 Other


Not sure how the companies pay the differential Bonuses as most of the companies would have paid the Bonuses for the year 2014-15 in the month of October-2015. It's going to be tough task to work on financial books for the companies who wouldn't have provisioned such cost.
Keshav Reddy

From India, Bangalore

Indeed a welcome measure by the government for raising the wage ceiling for calculating bonus. Once the bill became act we need to go through it to know all the amendments.
with effect from 1st April 2014 is beneficiary to employees but the employer have to incur additional financial burden as they have not book for the provision of bonus (INR 7000,00) in their books of account. lets see how they react.
lets wait for the copy of the amended act.

From India, Bhubaneswar

As well said by Mr.Keshav Reddy, how is it possible to workout the bonus under new amendment as the bonus for 2014-15 was already issued to the employees.
However, i may force to understand that the amendment bill bonus working to be done separately and the same would have been surpluses and will be disbursed along with 2016 bonus paying.
Further, I would like to have the comments on this matter.

From India, Mumbai

Payment of bonus is warranted only if there is an available / allocable surplus or its carry forward from from previous year/s. Otherwise only a minimum bonus is payable. So why should employers unduly worry about it? of course it widens the net and the absolute amount of bonus.
Good companies are already paying bonus to all employees irrespective of salary drawn or the surplus.
Experts may please correct me here.

From India, Pune

Hi Friends,
Bonus Act amendment has got notified in the Gazette.It is with w.e.f 1st April 2014. Hence all the companies has to be paid incremental Bonus and additional set of employees who got covered with the new amendment.
Keshav Reddy

From India, Bangalore

If you are knowledgeable about any fact, resource or experience related to this topic - please add your views.

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