The Ministry of Labour and Employment has issued Gazette Notification S.O. 4710(E) dated 25 August 2026 under Section 26(2) of the Code on Wages, 2019. The notification deals specifically with the wage figure to be used for calculating bonus in cases covered by Section 26(1) and Section 26(3).
The notification is legally important because, although published on 25 August 2026, it is deemed to have come into force from 21 November 2025.
What has the Government actually prescribed?
The Gazette says that where an employee is already eligible for bonus under Section 26(1), and that employee’s wage exceeds ₹7,000 per month, the bonus calculation will be based on:
₹7,000 per month or the minimum wage fixed by the Central Government, whichever is higher.
That is the central legal change contained in this notification.
A simple way to understand it is:
| Situation | Wage used for calculation |
|---|---|
| Central Government minimum wage is below ₹7,000 | ₹7,000 |
| Central Government minimum wage is above ₹7,000 | Higher minimum wage |
| Employee’s actual wage is above both figures | Actual wage is not automatically used under this notification |
The Gazette therefore creates a comparison-based calculation rule, not a flat ₹7,000 payment.
Why this notification should not be read as a ₹7,000 bonus announcement?
The ₹7,000 figure mentioned in the Gazette is part of the calculation mechanism.
The notification does not say that every eligible employee will receive ₹7,000 as bonus.
It also does not say that an employee’s salary has been fixed at ₹7,000.
The document is concerned with the notional wage figure on which bonus is to be calculated in the specified circumstances.
What the Gazette does not specify?
Several questions cannot be answered from this two-page notification alone.
The document does not provide:
- the actual Central Government minimum wage amount;
- a fresh bonus percentage;
- a list of employee categories covered;
- a department-wise bonus amount;
- a Central Government employees’ Diwali bonus sanction;
- or a final rupee amount payable to each employee.
This matters because the Gazette refers to the “minimum wage fixed by the Central Government”, but does not state what that wage is.
Any exact bonus calculation therefore requires additional information from the relevant wage and bonus framework.
Why the effective date is important?
The Gazette was published on 25 August 2026, but paragraph 2 states that the notification will be deemed to have come into force on 21 November 2025.
This means the notification has retrospective effect.
For any employee and establishment to which the relevant bonus provisions apply, the earlier effective date could matter when the applicable bonus period is examined.
However, this PDF alone is not enough to determine whether any employee is entitled to arrears or recalculation. That would require the applicable wage, bonus period and eligibility details.
Does this document announce a Central Government employees’ bonus?
The Gazette itself does not say that it is a general Central Government employees’ Diwali bonus order.
Its title and operative text show that it is a Ministry of Labour and Employment notification issued under the Code on Wages, 2019, dealing with the calculation of bonus under Section 26.
Therefore, this document alone should not be used to claim that:
“Central Government employees have been granted a new Diwali bonus.”
Such a conclusion would require a separate official order specifically sanctioning that benefit for the concerned category of employees.
A practical example
Suppose an eligible employee earns ₹20,000 per month.
If the applicable Central Government minimum wage were ₹10,000, the bonus calculation would use ₹10,000, because that amount is higher than ₹7,000.
If the applicable minimum wage were ₹6,500, the calculation base would instead be ₹7,000.
The example only demonstrates how the Gazette formula works. The actual minimum wage must come from the relevant official wage notification.
What employees should verify before calculating any amount?
Before arriving at an actual bonus figure, the following information needs to be established separately:
- whether the employee is covered by the relevant bonus provision;
- what Central Government minimum wage applies;
- what wage period is relevant;
- what bonus rate applies under the governing law or order;
- and whether any separate department-specific bonus instruction has been issued.
The Gazette provides only one part of that calculation chain: the wage base rule.
Conclusion
The 25 August 2026 Gazette Notification S.O. 4710(E) is a genuine statutory development relating to bonus calculation under the Code on Wages, 2019.
Its importance lies in establishing a prescribed wage base for eligible cases and giving that rule effect from 21 November 2025.
What it does not do is equally important: the PDF does not itself announce a new bonus rate, fix a new minimum wage amount, or sanction a separate Diwali bonus for Central Government employees.
The correct way to read this Gazette is therefore as a bonus-calculation notification, not as a standalone announcement of a fixed bonus payment.
Official source
Gazette of India, Extraordinary — Ministry of Labour and Employment, Notification S.O. 4710(E), dated 25 August 2026, F. No. S-33027/5/2026-WB.
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