Diwali Bonus 2023: Big news for central employees, government announces big bonus

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Diwali Bonus 2023: A big gift has been given to the central employees by the Narendra Modi government. The government has announced Diwali bonus for employees. Under this, bonus has been approved for Group C and non-gazetted Group B rank central government officers including paramilitary forces and armed forces. The Finance Ministry has announced non-productivity linked bonus (ad-hoc bonus) for employees on the occasion of Diwali. According to the notification issued by the Finance Ministry, a maximum bonus of seven thousand rupees has been announced for the government employees. Let us tell you that the government is to give bonus to those employees who have been in service till 31 March 2023. Also, must have served for at least 6 months during the financial year 2022-23. According to the employees union, about 30 lakh employees are going to benefit from the decision of the Central Government. However, now the employees are waiting to get dearness allowance before Diwali.

Government set conditions for bonus

Some conditions have been laid down regarding bonus in the notification issued by the Finance Ministry.

1. According to the ministry, only those employees who were in service as of March 31, 2023 and have rendered at least six months of continuous service in 2022-23 are eligible for the payment. Proportional payment will be admissible to eligible employees for period of continuous service from six months to full year during the year, the eligibility period will be taken with reference to the number of months in service.

2. The government has said that the quantum of non-productivity linked bonus will be decided on the basis of average emoluments or calculation limit, whichever is lower.

3. Casual workers who have worked for three years or more in offices with a six-day week or for at least 240 days each year (three years or more in the case of offices with a five-day week) in 206 days), will be eligible for payment of this bonus.

4. According to the Ministry, all payments under these orders will be rounded off to the nearest rupee.

5. It has been said in the notification that the expenditure on this account will be debited from the relevant item head as per the notification of the Department of Expenditure dated December 16, 2022.

6. As per the Government, the expenditure on account of this ad-hoc bonus is to be met from within the approved budget provision of the concerned Ministries/Departments for the current year.

What is bonus pay?

An employee receives compensation in addition to their basic salary. Bonus payments are a way for companies to show appreciation to employees or teams who have achieved important goals. Companies offer bonuses to increase employee morale, motivation and productivity. Annual income includes basic salary and any bonuses. The Payment of Bonus Act, 1965, is the primary law in India that regulates how employers must pay bonuses to workers. The Bonus Payment Act applies to all factories and businesses that have at least 20 people on their payroll on any day during the accounting period. Even if the number of employees in a company falls below 20, the Act states that bonus payment is mandatory.

How do bonus payments work?

Bonuses can be provided in various forms. However bonuses are generally performance based, that is, a company gives bonuses based on how well an employee or group of employees helps the team or company reach its goals. The manager decides to give the bonus, which indicates that the bonus is not dependent on any specific quota, level or performance. Instead, the manager is free to decide who should receive the bonus and what the amount of the bonus is. Typically, a non-discretionary bonus clause is included in an employee’s offer letter or contract.

Understand the calculation of bonus like this

According to changes in the Bonus Payment Bill passed in 2015, employers will have to pay bonuses to workers whose gross income is less than Rs. 21,000. The bonus is calculated as follows:

• If the salary of an employee is less than or equal to seven thousand rupees, then the formula for calculating bonus is: Bonus = Salary x 8.33/100.

• If the salary of an employee is Rs. If it is more than Rs 7000 then the bonus calculation formula will be: Bonus = Rs. 7,000 x 8.33/100.

Note: Salary = Basic Salary + Dearness Allowance

Example

• If an individual’s salary (Basic + DA) is Rs 2,000 then the bonus payable is calculated as: 2,000 x 8.33/100 = Rs. 166.6 per month (Rs. 2,000 per year)

• If a person’s salary (Basic + DA) is Rs. 10,500 then the bonus payable will be as follows: 7,000 x 8.33/100 = Rs. Rs 583 per month (Rs 6,996 per year)

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