Unveiling the Mystery: The Real Reason Behind Diwali Bonuses That Most People Don’t Know
Unveiling the Mystery: The Real Reason Behind Diwali Bonuses That Most People Don't Know.
Diwali is a festival of lights and is regarded as the most significant celebration in India. People from all walks of life, whether rich or less fortunate, celebrate Diwali in their unique ways. This festival is eagerly anticipated throughout the year. To join in the festivities, companies often provide bonuses to their employees. But why are these bonuses specifically given during Diwali? When did this tradition actually begin? Let’s explore.
As Diwali approaches, excitement fills the air. There’s a flurry of activities involving snacks, shopping, lighting, decorations, and gift-giving. The markets come alive with color and energy. Even those with limited means save what they can to partake in the celebrations. Both private companies and government bodies, at the central and state levels, offer bonuses to their employees during this festive time. This practice raises the question of why bonuses are specifically tied to Diwali and what the history behind it is.
Historically, before British rule in India, employees in princely states were compensated on a weekly basis. This system allowed workers to receive 52 paychecks each year, effectively giving them a salary for 13 months. However, with the advent of British control, the weekly payment system was abolished in favor of a monthly one. Consequently, employees began to receive payments for only 12 months a year, leading to a decrease in their overall annual income.
The history of the Diwali bonus in India is quite interesting and reflects the changes in labor practices over time. Initially, during the British colonial period, the loss of a four-week salary led to employee unrest, prompting the British to introduce a new system in 1940. This system ensured that employees received a month’s salary around Diwali, a significant festival in India, recognizing its importance to the workforce.
After India gained independence, this practice evolved into what is now known as the Diwali bonus, symbolizing a gesture of goodwill from employers to their employees. However, the issue of companies withholding this bonus led to the enactment of the Payment of Bonus Act in 1965, which mandated that bonuses be provided to employees, with a minimum of 8.33 percent of their salary. Despite this legal framework, many companies continue to find loopholes to avoid compliance.
Historically, India had a tradition of paying employees on a weekly basis, but this practice faded over time. The introduction of the Diwali bonus during the British era marked a significant shift in employee compensation, which eventually became a legal requirement, ensuring that employees receive this bonus as part of their annual earnings.
