Tiruppur knitwear units delay Diwali bonus; trade unions press for immediate disbursal

Chennai, Oct 15
With Diwali fast approaching, most knitwear manufacturing companies in Tiruppur are yet to distribute festive bonuses to their employees.

According to trade union estimates, only about 20 per cent of units have so far provided bonuses, leaving a large number of workers uncertain about their festival plans.

The Tiruppur knitwear hub, which employs over eight lakh workers directly, plays a crucial role in both export and domestic markets.

Yet, despite the long-standing custom of granting bonuses ahead of Diwali, most companies have delayed payment this year.

Unions have urged their managements to release the amounts immediately to help workers make purchases and travel to their hometowns.

The Payment of Bonus Act, introduced in 1965, mandates a minimum bonus of 8.33 per cent of a worker's annual salary, with higher percentages allowed based on company profits and employee experience.

In Tiruppur's knitwear sector, bonus rates often vary across firms, with some offering enhanced benefits to senior or long-serving staff. However, many companies are accused of holding back disbursals out of fear that workers might take leave once bonuses are paid.

Trade unions have described this as a recurring issue that forces employees to buy inferior goods due to delayed payments. They argue that the timely distribution of bonuses would not only ensure worker welfare but also strengthen goodwill and productivity within the industry.

Unions have also encouraged workers to approach them if bonuses are denied or delayed, asserting that several disputes were resolved in favour of workers last year.

Meanwhile, industry representatives maintain that the process of bonus distribution is already underway. They claim that payments began last week and will continue smoothly in the coming days. They also assert that recent global trade challenges, including the US tariff hike, have not affected the sector's ability to meet bonus commitments.

Tiruppur's knitwear industry comprises around 22,500 companies engaged in export and domestic production. In the last financial year, the sector recorded exports worth Rs 44,747 crore and domestic trade valued at Rs 30,000 crore, underscoring its importance to Tamil Nadu's economy and the livelihoods of thousands of workers preparing to celebrate Diwali.