Section 39: Time limit for payment of bonus
Reviewed by Finin2min Editorial Desk · Last reviewed 30 August 2026
Sets the deadline for payment of bonus, with a separate timeline where a dispute is pending and limited extension power.
Principal remaining provisions commenced on 21 November 2025 under S.O. 5322(E), read with the earlier partial commencement; check section-specific footnotes in the current India Code text.
Provision / India Code ↗ · Official Act PDF ↗ · 2026 Central Rules ↗
Finin2min analysis — what the section actually does
Operative clauses
- 39 .Time limit for payment of bonus.—(1) All amounts payable to an employee by way of bonus under this Code shall be paid by crediting it in the bank account of the employee by his employer within a period of eight months from the close of the accounting year:
- Provided that the appropriate Government or such authority as the appropriate Government may specify in this behalf may, upon an application made to it by the employer and for sufficient reasons, by order, extend the said period of eight months to such further period or periods as it thinks fit; so, however, that the total period so extended shall not in any case exceed two years.
- (2) Notwithstanding anything contained in sub-section (1), where there is a dispute regarding payment of bonus pending before any authority, such bonus shall be paid, within a period of one month from the date on which the award becomes enforceable or the settlement comes into operation, in respect of such dispute:
- Provided that if, there is a dispute for payment at the higher rate, the employer shall pay eight and one-third per cent. of the wages earned by the employee as per the provisions of this Code within a period of eight months from the close of the accounting year.
Provisos, explanations & qualifications
- Provided that the appropriate Government or such authority as the appropriate Government may specify in this behalf may, upon an application made to it by the employer and for sufficient reasons, by order, extend the said period of eight months to such further period or periods as it thinks fit; so, however, that the total period so extended shall not in…
- Provided that if, there is a dispute for payment at the higher rate, the employer shall pay eight and one-third per cent. of the wages earned by the employee as per the provisions of this Code within a period of eight months from the close of the accounting year.
Thresholds and timelines in the text
- 39 .Time limit for payment of bonus.—(1) All amounts payable to an employee by way of bonus under this Code shall be paid by crediting it in the bank account of the employee by his employer within a period of eight months from the close of the accounting year:
- Provided that the appropriate Government or such authority as the appropriate Government may specify in this behalf may, upon an application made to it by the employer and for sufficient reasons, by order, extend the said period of eight months to such further period or periods as it thinks fit; so, however, that the total period so extended shall not in…
- (2) Notwithstanding anything contained in sub-section (1), where there is a dispute regarding payment of bonus pending before any authority, such bonus shall be paid, within a period of one month from the date on which the award becomes enforceable or the settlement comes into operation, in respect of such dispute:
- Provided that if, there is a dispute for payment at the higher rate, the employer shall pay eight and one-third per cent. of the wages earned by the employee as per the provisions of this Code within a period of eight months from the close of the accounting year.
Actors expressly appearing in the text
Employer, Employee / worker, Appropriate Government, Authority / officer
Full statutory text — Section 39
39 .Time limit for payment of bonus.—(1) All amounts payable to an employee by way of bonus
under this Code shall be paid by crediting it in the bank account of the employee by his employer within a
period of eight months from the close of the accounting year:
Provided that the appropriate Government or such authority as the appropriate Government may
specify in this behalf may, upon an application made to it by the employer and for sufficient reasons, by
order, extend the said period of eight months to such further period or periods as it thinks fit; so, however,
that the total period so extended shall not in any case exceed two years.
(2) Notwithstanding anything contained in sub-section (1), where there is a dispute regarding
payment of bonus pending before any authority, such bonus shall be paid, within a period of one month
from the date on which the award becomes enforceable or the settlement comes into operation, in respect
of such dispute:
Provided that if, there is a dispute for payment at the higher rate, the employer shall pay eight and
one-third per cent. of the wages earned by the employee as per the provisions of this Code within a period
of eight months from the close of the accounting year.How to apply this provision
- Primary statutory test — 39 .Time limit for payment of bonus.—(1) All amounts payable to an employee by way of bonus under this Code shall be paid by crediting it in the bank account of the employee by his employer within a period of eight months from the close of the accounting year:
- Additional operative limb — Provided that the appropriate Government or such authority as the appropriate Government may specify in this behalf may, upon an application made to it by the employer and for sufficient reasons, by order, extend the said period of eight months to such further period or periods as it thinks fit; so, however, that the total period so extended shall not in any case exceed two years.
- Qualification / exception to test — Provided that the appropriate Government or such authority as the appropriate Government may specify in this behalf may, upon an application made to it by the employer and for sufficient reasons, by order, extend the said period of eight months to such further period or periods as it thinks fit; so, however, that the total period so extended shall not in…
- Numerical or timing control — 39 .Time limit for payment of bonus.—(1) All amounts payable to an employee by way of bonus under this Code shall be paid by crediting it in the bank account of the employee by his employer within a period of eight months from the close of the accounting year:
- Evidence file — retain facts and records proving the role/status of: Employer, Employee / worker, Appropriate Government, Authority / officer.
Rules, forms and cross-references
Direct 2026 Central Rule mapping
Forms mapped
No prescribed form is directly mapped in the current concordance.
Other sections cited in this text
Related Labour Hub resources
A direct concordance is not exhaustive. Central/State jurisdiction, schemes, authority appointments, saved instruments and later notifications may change the practical route without changing the section wording.
Worked example
An employer configuring payroll for time limit for payment of bonus should first identify the employee and wage period, then apply the exact provision and any linked rule. The system rule should be tested against a sample payslip and bank/payment record. A text point to test is: “39 .Time limit for payment of bonus.—(1) All amounts payable to an employee by way of bonus under this Code shall be paid by crediting it in the bank account of the employee by his employer within a period of eight months from the close of the accounting year:” Also test the express qualification/proviso before concluding the result.
Illustration only; it is not statutory text or a substitute for applying the actual facts, jurisdiction, current rule/scheme and official instrument.
Q&A — Section 39
What does Section 39 of the Code on Wages cover?
Sets the deadline for payment of bonus, with a separate timeline where a dispute is pending and limited extension power.
What is the main legal requirement or power in Section 39?
The first operative clause identified from the official text is: “39 .Time limit for payment of bonus.—(1) All amounts payable to an employee by way of bonus under this Code shall be paid by crediting it in the bank account of the employee by his employer within a period of eight months from the close of the accounting year:” Read it with the remaining subsections and any proviso below.
Does Section 39 contain a proviso or explanation?
Yes. A qualification extracted from the official text is: “Provided that the appropriate Government or such authority as the appropriate Government may specify in this behalf may, upon an application made to it by the employer and for sufficient reasons, by order, extend the said period of eight months to such further period or periods as it thinks fit; so, however, that the total period so extended shall not in…”
What time limit, percentage or amount appears in Section 39?
The provision contains this numerical/time expression: “39 .Time limit for payment of bonus.—(1) All amounts payable to an employee by way of bonus under this Code shall be paid by crediting it in the bank account of the employee by his employer within a period of eight months from the close of the accounting year:” Apply it only in the clause and context in which it appears.
Which 2026 Central Rules are linked to Section 39?
No direct Central Rule is recorded in the current concordance. That does not exclude a relevant scheme, notification, State rule or enabling provision.
Is Section 39 currently operative?
Principal remaining provisions commenced on 21 November 2025 under S.O. 5322(E), read with the earlier partial commencement; check section-specific footnotes in the current India Code text.
Source & verification trail
Act: Code on Wages, 2019 — official India Code PDF ↗
Central Rules: Code on Wages (Central) Rules, 2026 — G.S.R. 343(E), 8 May 2026 ↗
Official library: Ministry of Labour & Employment — Labour Codes ↗
Source check: 20 August 2026. Individual professional interpretation should be re-reviewed when the section, rules, notification, scheme, State overlay or controlling judgment changes.