Under the Code on Wages, 2019, where there is a dispute regarding the fixation of bonus or eligibility for payment of bonus, an employee is entitled to be paid a minimum bonus by the employer irrespective of whether the establishment has any allocable surplus in the accounting year. The minimum bonus payable to an eligible employee is:

Section 26 of the Code on Wages, 2019 governs the payment of bonus. It provides that every employer shall pay to every eligible employee a minimum bonus of 8.33 per cent of the wages earned by the employee, or one hundred rupees, whichever is higher, whether or not the employer has any allocable surplus during the accounting year. Where the allocable surplus exceeds the minimum bonus, the employer must pay a higher bonus proportionate to the wages, subject to a maximum of 20 per cent of the wages. For the purpose of calculating bonus, employees drawing wages above a notified ceiling are deemed to draw wages at that ceiling. This provision guarantees a baseline bonus even in years where the establishment earns no surplus.