Act amended to make workers eligible for higher bonus

09 January 2016

The government on 1 January notified the Payment of Bonus Act, allowing for an increase in bonus payments to employees whose wages fall below Rs21,000 per month.

The Payment of Bonus (Amendment) Bill, 2015, passed in the recently-concluded Winter Session of Parliament, increases the salary limit for bonus from Rs10,000 per month to Rs21,000 and the calculation ceiling from Rs3,500 to Rs7,000 or the minimum wage for the scheduled employment, as fixed by the concerned state, whichever is higher.

The Payment of Bonus (Amendment) Act, 2015 also mandates previous publication of draft subordinate legislations, framed under the enabling provisions under the said Act, in the official gazette for inviting objections and suggestions before their final notification.

The provisions of the Act are effective from 1 April 2014. "The Payment of Bonus (Amendment) Act, 2015 has been published in the Gazette of India, Extraordinary on January 1, 2016," an official statement said Friday.

Government had been receiving representations from trade unions for removal of all ceilings under the Payment of Bonus Act, 1965, it added.

It is also one of the demands made by unions during the country-wide general strike held in February, 2013 and September, 2015.

As the last revision in these two ceilings were made in the year 2007 and was made effective from April 1, 2006, it was decided by the government to make appropriate amendments to the Payment of Bonus Act, 1965, the statement said.

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