Labour Commissioner Jammu and Kashmir, S. Charandeep Singh has called upon all employers and establishments across the Union Territory to strictly comply with the provisions of the Payment of Bonus Act, 1965. This appeal is part of the Labour Department’s broader efforts to ensure transparency, accountability, and the protection of workers’ statutory rights.
The Payment of Bonus Act, 1965, is a central legislation that mandates the payment of annual bonuses to employees of factories and other establishments employing twenty or more persons. The Act aims to promote equitable distribution of profits by linking a portion of an employee’s wages to the productivity and performance of the establishment. It not only serves as an incentive for the workforce but also strengthens industrial harmony.
Under the Act, employees drawing a salary or wage not exceeding ₹21,000 per month are eligible for a bonus. The bonus is calculated on a wage ceiling of ₹7,000 per month or the minimum wage for the scheduled employment, whichever is higher. Establishments are required to pay a minimum bonus of 8.33% of the wages, even in cases where no allocable surplus exists, while the maximum bonus can go up to 20% depending on profits.
The Labour Commissioner emphasized that timely and correct disbursement of bonus is not merely a legal obligation but also an important measure to boost worker morale and foster a collaborative work environment. He urged all employers covered under the Act to ensure that bonus payments are made well within the prescribed time limits, as stipulated under Section 19 of the Act, and that proper records are maintained for audit and verification purposes.
Employers have been cautioned that non-compliance with the provisions of the Payment of Bonus Act may attract legal consequences, including penalties and imprisonment under Section 28 of the Act. The Labour Department will be closely monitoring the compliance status of establishments and taking necessary action wherever violations are found.
The Department of Labour, J&K, remains committed to safeguarding the interests of workers and ensuring that labour laws are effectively implemented across all sectors. Employers and employees are encouraged to remain informed about their rights and responsibilities under the Act.