Ever since 1-4-1993 the revised celling for eligibility for bonus vide Amendment No.34 of 1995 remained Rs.3,500 per month albeit there has been steep hike in the salaries/wages. In some States like Delhi and Haryana, the prevailing minimum rates of wages even for an unskilled worker has now been above Rs.3,500 per month. Hence the Act, though a beneficial piece of legislation for the working class became redundant. Every year, particularly before Diwali, it was expected that there will be increase in the salary ceiling for eligibility but no amendment was made despite demands by the trade union and even the employers wanted reasonable increase in order to maintain industrial peace and harmony. This year an Ordinance has been issued on 27.10.2007 by increasing the salary ceiling to Rs.10,000 per month. The entitlement for calculation of bonus will be Rs.3,500 per month. The provisions of the Payment of Bonus Act and the Rules are simplified in the article.