New Delhi, India
Amid growing discussions over the 8th Pay Commission, demands are intensifying for a change in the existing formula used to calculate Diwali bonuses for central government employees. Employee organisations argue that the current ₹7,000 calculation ceiling has become outdated. They are demanding that the ceiling be removed and that bonuses instead be calculated on the basis of the current minimum basic pay or the new minimum salary that may be fixed under the 8th Pay Commission.
Under the existing system, the Non-Productivity Linked Bonus (NPLB) and certain other bonuses are calculated using a maximum calculation ceiling of ₹7,000. This means that even if an employee’s actual basic pay is higher, ₹7,000 is used as the basis for calculating the bonus.
If the current minimum basic pay of ₹18,000 is used as the calculation base and a 30-day bonus is considered, the amount could reach approximately ₹17,763. Under the existing formula, the amount remains around ₹6,908.
Employee organisations are demanding that the outdated ₹7,000 ceiling be abolished and that bonuses be linked to the actual minimum basic pay. If the minimum salary under the 8th Pay Commission is fixed between ₹26,000 and ₹34,500 and that amount is used as the basis for bonus calculations, a 30-day bonus could amount to around ₹25,600 or more.
The proposed change could affect employees working in the Railways, Postal Department, Ordnance Factories and other government departments. It could also have an impact on the 78-day productivity-linked bonus paid to non-gazetted railway employees.
However, the proposal is currently only at the demand stage. The exact impact and any change in the bonus formula will become clear only after the government takes an official decision.
