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Labour Welfare Fund
Payment of Bonus Act, 1965
Short Title, Extent and Application
This act may be called the Payment of Bonus Act, 1965.
It extents to the whole of India*.
Save as otherwise provided in this Act, it shall apply to -
 
Every factory, and
Every other establishment in which twenty or more persons are employed on any day during an accounting year.
  [provided that the appropriate Government may, after giving not less than two months notice of his intention so to do,
  by notification in the Official Gazzette,apply the provisions of this Act with effect from such accounting year as may be
  specified in the notification, to any establishment or class of establishment [including an establishment being a factory
  within the meaning of sub-clause (ii) of clause m of Section 2 of the Factory Act, 1948 (63 of 1948) employing such
  number of persons less than twenty as may be specified in the notification; so however, that the number of persons so
  specified shall in no case be less than ten.]
Save as otherwise provided in this Act, the provisions of this Act shall, in relation to a factory or other establishment to which
  this Act applies, have effect in respect of the accounting year commencing on any day in the year 1964 and in respect of every
  subsequent accounting year. [provided that in relation to the State of Jammu and Kashmir, the reference to the accounting year
  commencing on any day in the year 1964, and every subsequent accounting year shall be constructed as reference to the
  accounting year commencing in any day in the year 1968 and every subsequent accounting year.]
  [provided further that when the provisions of this Act have been made applicable to any establishment or class of establishment
  by the issue of a notification under the provisio to sub-section (3), the reference to the accounting year commencing on any day
  in the year 1964 and every subsequent accounting year or, as the case may be, the reference to the accounting year
  commencing on any day in the year 1968 and every subsequent accounting year shall, in relation to such establishment or class
  of establishments, be construed as a reference to the accounting year specified in such notification and every subsequent
  accounting year.]
An establishment to which this Act applies shall continue to be governed by this Act notwithstanding that the number of persons
  employed therein falls below twenty [or, as the case may be,] the number specified in the notification issued under the provision
  to sub-section(3)].
 
Introduction
The law relating to payment of bonus is governed by the following legislations :-
Payment of bonus Act, 1965.
Payment of Bonus Rules, 1975.
 
Objective of the Act
The objective of the Act is to provide for the payment of bonus to persons employed in certain establishments on the basis of profits
or on the basis of productivity and for matters connected therewith.
 
Applicability of the Act
The act shall apply to every factory and every other establishment in which twenty or more persons are employed on any day
during the accounting year. The appropriate Government may, by giving a notice of not less than two months and by notification in
the Official Gazette, extend the applicability of the Act to any other establishment (s) employing more than 10 person and less than
20 persons. The establishment which has been covered under the Act shall continue to be governed by the Act, even though the
number of persons employed therein falls below the prescribed limit of 20 or the number specified in the notification, as the case
may be.
 
Obligations of the Employer
Payment of Bonus
Special Provisions in case of new units
Reference of disputes
Maintenance of registers and records
Annual Return
Claim for non-payment of bonus
   
Offences & Penalties
If any person : -
Contravenes any of the provisions of this act or any rule made there under, or
to whom a direction is given or a requisition is made under this Act fails to comply with the direction or requisition.
He shall be punishable with imprisonment for a term which may extend to six months, or with fine which may extend to one
thousand rupees, or with both.
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