Payment of Bonus Act

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THE PAYMENT OF BONUS ACT, 1965

INTRODUCTION

The practice of paying bonus in India appears to have originated during First World War when certain textile mills granted 10% of wages as war bonus to their workers in 1917. In certain cases of industrial disputes demand for payment of bonus was also included. In 1950, the Full Bench of the Labour Appellate evolved a formula for determination of bonus. A plea was made to raise that formula in 1959. At the second and third meetings of the Eighteenth Session of Standing Labour Committee (G. O.I.) held in New Delhi in March/April 1960, it was agreed that a Commission be appointed to go into the question of bonus and evolve suitable norms. A Tripartite Commission was set up by the Government of India to consider in a comprehensive manner, the question of payment of bonus based on profits to employees employed in establishments and to make recommendations to the Government. The Government of India accepted the recommendations of the Commission subject to certain modifications. To implement these recommendations the Payment of Bonus Ordinance, 1965 was promulgated on 29th May, 1965. To replace the said Ordinance the Payment of Bonus Bill was introduced in the Parliament.

STATEMENT OF OBJECT AND REASONS

A Tripartite Commission was set by the Government of India by their resolution No.WB-20(9)/61, dated 6th December, 1961 to consider in a comprehensive manner, the question of payment of bonus based on profits to employees employed in establishments and to make recommendations to the Government. The Commission’s Report containing their recommendations was received by the Government on 24th January, 1964. In their Resolution No. WB-20(3)/64, dated the 2nd September, 1964, the Government announced acceptance of the Commission’s recommendations subject to a few modifications as were mentioned therein. With a view to implement the recommendations of the Commission as accepted by the Government, the Payment of Bonus Ordinance, 1965, was promulgated on 29th May, 1965. The object of the Bill is to replace the said Ordinance.

The notes on clauses explain the various provisions of the Bill.

ACT 21 OF 1965

The Payment of Bonus Bill having been passed by both the Houses of Parliament received the assent of the President on 25th September, 1965. It came on the Statute Book as THE PAYMENT OFBONUS ACT, 1965 (21 of 1965).

LIST OF AMENDING ACTS

1.The Insurance (Amendment) Act, 1968 (62 of 1968).
2.The Payment of Bonus (Amendment) Act, 1969 (8 of 1969). 3.The Central Labour Laws (Extension of Jammu And Kashmir) Act, 1970
(51 of 1970).
4.The Payment of Bonus (Amendment) Act, 1972 (68 of 1972).
5.The Payment of Bonus (Amendment) Act, 1973 (39 of 1973).
6.The Payment of Bonus (Second Amendment) Act, 1973 (55 of 1973).
7.The Payment of Bonus (Amendment) Act, 1974(42 of 1974).
8The Payment of Bonus (Amendment) Act, 1976(23 of 1976).
9The Payment of Bonus (Amendment) Act, 1977 (43 of 1977) [as amended by the Payment of Bonus (Amendment) Act, 1978 (48of 1978) and the Payment of Bonus (Amendment) Act, 1980 (5 of 1980)].
10.The Payment of Bonus (Second Amendment) Act, 1980 (66 of 1980).
11.The National Bank for Agriculture and Rural Development Act, 1981 (61 of 1981).
12.The Payment of Bonus (Amendment) Act, 1985 (30 of 1985).
13.The Payment of Bonus (Second Amendment) Act, 1985 (67of 1985).
14.The National Housing Bank Act, 1987 (53 of 1987).
15.The Small Industries Development Bank of India Act, 1989 (39 of 1989).
16The Payment of Bonus (Amendment) Act, 1995 (34 of 1995).

THE PAYMENT OF BONUS ACT, 1965

(21 of 1965)
[25th September, 1965]

[An Act to provide for the payment of bonus to persons employed in certain establishments on the basis of profits or on the basis of production or...
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