Hello Seniors
Require clarification regarding Bonus calculations. If an employee's basic + da is Rs.10000.00 pm and if he attends 15 days in a month
and earns Rs.5770.00 (Rs.10000/26=385 x 15 days = 5770) the bonus to be calculated on Rs.5770 or the ceiling of Rs.7000.00 please
share your expertise.

Thanks and Regards.
YD Gopaul
Sahney Commutators Pvt Ltd

From India, Bengaluru
Dear YD

Every employee shall be entitled to be paid by his employer in an accounting year, bonus, in accordance with the provisions of THE PAYMENT OF BONUS ACT, 1965, provided he has worked in the establishment for not less than thirty working days in that year.
So he/she is not eligible for the Bonus.


Heera Singh Kamboj

From India, Gurugram
Srinath Sai Ram

Dear YD Gopaul,
Bonus is Payable on actual Basic & DA Earned i.e on Rs 5,770/- Monthly Basic=DA of Rs 10,000/- is Higher than Rs 7,000/- Bonus is Payable on Actual basic=DA or on Ceiling of Rs7,000/- which ever is Higher.
Employee has to earn Minimum 30 Daya Salary in FY to be eligible for Payment of Bonus Act, 1965

From India, New Delhi
Srinath Sai Ram

Dear Heera Singh Kamboj, Every Employee is not Eligible for Bonus.Only Employee whose Basic +DA is Rs 21,000/-PM & below is eligible for Bonus as per The Payment of Bonus Act, 1965
From India, New Delhi

Hi Sahney,

Calculating bonuses can depend on various factors, including company policies, local labor laws, and any specific agreements in place. However, I can provide you with a general understanding.

In many cases, when calculating bonuses, the actual amount earned or contributed by the employee is considered. In your example, the employee earned Rs.5770.00 for the month based on attendance.

If there is a ceiling limit of Rs.7000.00 for the bonus, this means that even if the calculated bonus is higher than Rs.7000.00, the bonus will be capped at Rs.7000.00. However, if the calculated bonus is less than Rs.7000.00, the employee would receive the actual calculated bonus.

So, in your case, if the bonus is calculated to be Rs.5770.00, and there's a ceiling of Rs.7000.00, the employee would receive Rs.5770.00 as the bonus because it's lower than the ceiling.

It's important to note that specific details may vary based on company policies, employment contracts, and applicable labor laws. Therefore, it's recommended to refer to your company's HR policies or consult with HR personnel to get precise information based on your organization's rules and regulations.

From India, Bangalore
Srinath Sai Ram

Dear Mr Raghunath, Please peruse attachment-The Payment of Bonus(Amendment)Bill, 2015 which is self explanatory.
From India, New Delhi
Attached Files (Download Requires Membership)
File Type: pdf The Payment of Bonus(Amendment)Bill, 2015.pdf (299.6 KB, 12 views)


Bonus is a central Act. It is applicable in all States of India uniformly. It is not all varying from State to State. There are several steps related to Payment of Bonus. It has individual eligibility limit ( 21 K Basic & DA ), minimum working days in a year -30, Calculation of individual bonus is based on 7000/- or minimum wages which one is higher, It is deferred wages, All wage ceiling is based on notional value but calculation based on actual. Bonus does not mean only 8.33%, rather it varies between 8.33% to 20%.

From Gross Profit of P & L Account first of all it is determined Available Surplus and certain % of Available surplus is allocable surplus. Considering Set On or Set Off if any to determine the % of Bonus. Then to find out the bonus eligibility employees. Now based on Minimum wages or 7000/- whichever is higher to determine the base value of bonus calculation. At last on actual earning and considering LWP to calculate individual bonus amount.

S K Bandyopadhyay ( WB, Howrah)
CEO-USD HR Solutions
+91 98310 81531

From India, New Delhi
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