Is Paying a Monthly Bonus Mandatory Under the Bonus Act? Seeking Clarification

Is it mandatory to pay a monthly bonus under the Bonus Act? If yes, kindly provide the notification.

Mr. Malik,

Please note that the payment of the bonus is linked to the profitability of the establishment/factory and can be decided after the compilation of annual accounts. The due date for payment is 8 months from the closing of the financial year. However, if you wish to pay it monthly, it is called the interim bonus, which can be adjusted into payable bonus at the end.

Mr. J. Malik,

There is another terminology called production incentive bonus payable on a monthly basis. However, as stated by you, it can be done only if there is an agreement or policy in the company to pay an advance bonus. Generally, it is not practiced.

V. Murali