11-02-2008, 11:50 AM
|  | | | Join Date: Feb 2008 Location: Goa
Posts: 5
| |  Calculation of Gratuity under Shops & Establishment Act
For the purpose to calculate Gratuity under the shops & establishment act, what should be minimum service length and the salry, whether basic or gross.
Kashi
I will make it more clear that:-
The organisation is covered under the shops & establisment Act by its nature of business.
And
Off course Gratuity will be calculated under the payment of gratuity Rules, 1973.
The calculation of Gratuity should be different based on the establishment whether it is covered under the Factory Act or S&E Act. |
11-02-2008, 12:03 PM
| | | | Join Date: Jan 2008 Location: Bangalore
Posts: 86
| | Re: Calculation of Gratuity under Shops & Establishment
Dear Friend
Gratuity is paid under Grtuity act not shops and establishment act
Minimun he should have been worked 5 years cotinously in an organisation.
Vasanth
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Vasanth |
11-02-2008, 02:33 PM
|  | | | Join Date: Feb 2007 Location: Pune
Posts: 104
| | Re: Calculation of Gratuity under Shops & Establishment
Hi - Agreed with Vasu that Gratuity is paid as per Gratuity Act and not as per shop and establishment act however below is the formula for calculation of Gratuity
Basic * 15 / 26 * years = Gratuity not more than 3.5 lacs
Basic = Last Drawan Basic
15 = Halof of Basic
26 = 26 working days in a month
Year = Year of serivce which should be more that 5 years of continous employment
Rgds
shiva
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Warm Regards,
Shiva
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11-02-2008, 03:29 PM
| | | | Join Date: Dec 2007 Location: Chennai
Posts: 1,278
| | Re: Calculation of Gratuity under Shops & Establishment
Shiva
Just one correction 15 is not half of basic It is the number of days
An employee is eligible for 15 days of wage per year of completed service if he comp0letes 5 years
One day wage is calculated as per the Supreme Courts observation dividing the Basic +Da by 26 days.
That is how thge formula Last drawn basi+Da*15*Number of years of service/26
Siva
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T.Sivasankaran
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11-02-2008, 03:33 PM
| | | | Join Date: Feb 2007 Location: Pune
Posts: 104
| | Re: Calculation of Gratuity under Shops & Establishment
Hi - Agreed with Vasu that Gratuity is paid as per Gratuity Act and not as per shop and establishment act however below is the formula for calculation of Gratuity
Basic * 15 / 26 * years = Gratuity not more than 3.5 lacs
Basic = Last Drawan Basic
15 = Halof of Basic
26 = 26 working days in a month
Year = Year of serivce which should be more that 5 years of continous employment
Rgds
shiva
__________________
Warm Regards,
Shiva
91-0-9890661017
"The difference between ordinary and extraordinary is that little extra."
|
11-02-2008, 09:34 PM
| | | | Join Date: Dec 2007 Location: Chennai
Posts: 1,278
| | Re: Calculation of Gratuity under Shops & Establishment
Shiva
15 is not half the wages
It represents 15 days per year of service
26 represents a month as decided by the supreme court
Siva
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T.Sivasankaran
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12-02-2008, 04:27 PM
| | | | Join Date: Jan 2008 Location: Ranchi
Posts: 60
| | Re: Calculation of Gratuity under Shops & Establishment
DA is also included in the basic for calculation of Gratuity. If the total service is 35 years then upto 30 years the above formula including Da is OK but for remaining five years gratuity is calculated taking into account one month salary for five years (in excess of 30 years). If the amount calculated is more than Rs.3.5 lakhs it is limited to 3.5 lakhs only. But when it falls below 3.5 lacks it will be as per actual. Gratuity is paid once in a whole period of service only after separation from the service. |
12-02-2008, 07:05 PM
| | | | Join Date: Jan 2008 Location: Mumbai
Posts: 18
| | Re: Calculation of Gratuity under Shops & Establishment
Hi
Mr. Siva from chennai has answered correctly and I fully agree with him.
regards
R G NAGENDRA |
12-02-2008, 07:14 PM
| | | | Join Date: Dec 2005 Location: NOIDA
Posts: 24
| | Re: Calculation of Gratuity under Shops & Establishment
Dear All,
i have a point
an establishment started with 4 employees and in the 4th year there were 7 employees. in the middle 4th year the no of employees raised to 12.
Now my point is
Whether the no of years for calculation of gratuity will be counted from the date of joining of employee no 1 who is still in service or from the date act become applicable to the establishment.
regards
Dabas |
12-02-2008, 07:54 PM
| | | | Join Date: Dec 2007 Location: Chennai
Posts: 1,278
| | Re: Calculation of Gratuity under Shops & Establishment
From the date of employment
Siva
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T.Sivasankaran
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