The word "bonus" does a great deal of damage here. It suggests a share of profits, paid when there are profits, at the employer's discretion.
Under the Payment of Bonus Act the minimum of 8.33% of wages is payable whether or not the establishment made a profit, and whether or not there is any allocable surplus at all.
Between the floor and the ceiling
Above the 8.33% minimum, the rate is driven by the allocable surplus computed under the Act, up to a maximum of 20%.
So in most years the question is not whether to pay. It is where between the two bounds the rate falls — which is a computation, not a decision made over a conversation.
The people most often missed
Leavers. Eligibility turns on working a minimum number of days in the accounting year, not on being employed at the end of it. Somebody who left in November may well qualify, and they are exactly the group nobody thinks to include.
Mid-year joiners, for the same reason.
Both are missed because the bonus list is usually built from the current payroll rather than from everybody who worked during the accounting year. Those are different lists.
Two ceilings, not one
This catches people regularly. There is a wage limit that decides eligibility, and a separate ceiling used to compute the amount. An employee earning above the computation ceiling but within the eligibility limit gets a bonus calculated on the ceiling figure — not on their actual wages, and not nothing.
It also has a deadline and a register
Bonus must be paid within the prescribed period after the accounting year closes, and the register maintained. An undocumented cash payment made whenever it is convenient satisfies neither the employee nor an inspection.
Where this is heading
The Payment of Bonus Act is one of four statutes consolidated into the Code on Wages, 2019. Until the Code's provisions are fully in force the existing Act governs — but the direction is toward one uniform definition of wages across bonus, minimum wages and payment of wages, which will change the base the 8.33% is computed on for many structures.