Mint Explainer: Who qualifies for the Centre’s Diwali bonus, and how much will they get?

The government, which had 3.66 million civilian employees as of March 2025, has not disclosed how many are expected to receive the bonus. Mint explains who qualifies for the bonus and how the payout is calculated.

Which central government employees are eligible?

The bonus is available to central government employees in Group C and non-gazetted Group B categories, but excludes Group A and Group B gazetted officers. Group A comprises senior government officers, including Indian Administrative Service (IAS) and Indian Police Service (IPS) personnel; Group B covers mid-level staff in supervisory, executive or administrative roles; and Group C includes operational, clerical, and support roles such as assistants and data-entry operators.

Eligible employees of the armed forces and central armed police forces are also covered. The order also applies to employees of Union territory administrations that follow the Centre’s pay structure, provided they are not covered by another bonus or ex-gratia scheme.

To qualify, employees must have been in service on 31 March 2026 and completed at least six months of continuous service during the accounting year 2025-26. Employees who completed between six months and a full year of eligible service will receive the bonus on a proportionate basis. The eligible period is calculated in months, rounded to the nearest one.

Are temporary employees and retirees eligible?

Yes, provided they meet specific criteria. Temporary or ad-hoc employees qualify if they have completed at least six months of continuous service without a break. Under department of expenditure guidelines, employees who retired on superannuation or on medical grounds, or passed away before 31 March 2026 are eligible for a proportionate bonus, provided they completed at least six months of regular service in FY26. For those re-employed after superannuation, the re-employment period is evaluated separately, though the total payout across both periods cannot exceed the maximum bonus allowed under the order.

How much will employees receive?

The bonus is calculated based on average monthly emoluments or the prescribed cap of ₹7,000, whichever is lower. Under department of expenditure rules, average monthly earnings are divided by 30.4 to determine the daily rate, which is then multiplied by the number of bonus days granted.

For employees earning ₹7,000 or more per month, the maximum 30-day payout comes to ₹6,908 under this formula. Staff eligible for a shorter tenure receive a proportionately lower amount, while those earning below the ₹7,000 ceiling have their payout computed using their lower actual earnings.

What are the rules for casual labourers?

Casual labourers employed in government offices can qualify if they meet a separate work requirement. Those working in offices that follow a six-day week must have completed at least 240 days of work in each year for three or more years. In offices following a five-day week, the requirement is at least 206 days in each year.

For eligible casual labourers, the monthly calculation ceiling is ₹1,200. A 30-day bonus at this ceiling works out to ₹1,184 after rounding. If actual monthly emoluments are lower than ₹1,200, the bonus will be calculated on the basis of actual emoluments.

However, the requirement to be in service on 31 March 2026 applies to regular government employees and not casual labourers. For a casual labourer who has worked in different government offices, the required number of workdays may be combined across offices, provided the labourer has not already earned and received bonus, ex-gratia or incentive payments for that work.

Who doesn’t qualify for the bonus?

Part-time employees engaged on nominal fixed payments continue to be excluded. Employees deputed to state governments, Union territory governments or public sector undertakings on foreign service terms remain ineligible to receive the bonus from their parent central government departments.

In such cases, the borrowing organisation usually determines the applicable payment under its own bonus, productivity-linked bonus, ex-gratia or incentive scheme, if any. Employees transferred between central government departments or eligible Union territory administrations without a break in service, however, qualify on the basis of their combined service.