Am I eligible for statutory bonus and how is it calculated?

Question

My company has not paid me any bonus this year and I want to know whether I am legally entitled to one and how much. Before I spend money on it, I want to know whether Payment of Bonus Act 1965, Section 8 gives me a remedy here and what proof I would need. Any Section numbers I can quote when I write to them would be useful.

MyVakeel Legal Desk · Accepted Answer

Payment of Bonus Act 1965, Section 8, Payment of Bonus Act 1965, Section 10 and Payment of Bonus Act 1965, Section 12 is what decides this question in India. Read it alongside the provisions named, because the relief available to you turns on the facts you can prove on paper.

Section 8 of the Payment of Bonus Act 1965 makes every employee drawing wages up to the notified ceiling eligible for bonus provided they have worked for at least 30 working days in the accounting year.

Section 10 mandates a minimum bonus of 8.33% of salary or wages earned during the accounting year, or 100 rupees whichever is higher, payable irrespective of whether the employer has made any profit in that year.

Section 12 caps the salary considered for bonus calculation at a notified amount even if the employee's actual salary is higher, so bonus is computed on the lower of actual salary or the statutory ceiling.

The maximum bonus payable can go up to 20% of wages depending on the allocable surplus calculated as per the Act's schedules, and employers must disburse bonus within 8 months from the close of the accounting year.

An employee who is dismissed for fraud, riotous behaviour or theft during the accounting year can be disqualified from bonus under Section 9, but this disqualification must be based on an established misconduct, not a mere allegation.

Practical steps: 1) Check whether your monthly salary falls within the wage ceiling notified under the Act; 2) Verify the number of working days you completed in the relevant accounting year; 3) Request a written computation of bonus payable from your employer's accounts or HR team; 4) File a claim before the labour authority if the minimum bonus is denied or delayed beyond 8 months.

If the other side has already issued a notice, filed a case or set a deadline, treat the matter as time-sensitive — remedies under Payment of Bonus Act 1965, Section 8 carry limitation periods, and unexplained delay weakens an otherwise strong case. You can post the details on the MyVakeel forum for a practising advocate to review, or book a paid consultation with a Bar Council verified lawyer in labour law.