Dear Experts,
can you pl. explain the following points ?
1) Is any body eligible to get gratuity if he resigns after completion of continuous service of less than 5 years (specific period : 4 yrs.10 months 11 days)?
2) If, in his appointment letter it has been written that he will be out of the perview of 'Industrial Dispute Act'. What will happen in respect of getting his above Gratuity claim ?
Thanks & regards.
P.C.Bagchi[/b]
From India, Calcutta
can you pl. explain the following points ?
1) Is any body eligible to get gratuity if he resigns after completion of continuous service of less than 5 years (specific period : 4 yrs.10 months 11 days)?
2) If, in his appointment letter it has been written that he will be out of the perview of 'Industrial Dispute Act'. What will happen in respect of getting his above Gratuity claim ?
Thanks & regards.
P.C.Bagchi[/b]
From India, Calcutta
Hi Prakritish,
I have seen your post in Cite HR. If you would have posted it in HR forum you would have received lot of replies from fellow colleques. Ok for your queries find the answers below:
If a person not completed 5 years of service he is not eligible for the gratuity amount. Only in the case of death of an employee, this clause is not applicable.
People get confused with the rounding of the service to 5 years for those who have completed 4 years and few months. This rounding off of years is applicable after 5 years completion. For example, if a person completed 5 years 8 months, then his total service becomes 6 years and not 5 years. So to get gratuity claim it is necessary that the employee should completed 5 years of service.
For your second query, though it is mentioned in the appointment letter, that the employee is out of purview of Industrial Disputes Act, the employer cannot deny the gratuity. It will not fall under the ID act. The gratuity is a separate entity. Whatever the case it has to be paid, except if the employee is terminated on account of misbehaving or any other acts of him caused a loss to the employer.
Hope this would clarify your query.
Regards,
Umesh.S.
From India, Bangalore
4I have seen your post in Cite HR. If you would have posted it in HR forum you would have received lot of replies from fellow colleques. Ok for your queries find the answers below:
If a person not completed 5 years of service he is not eligible for the gratuity amount. Only in the case of death of an employee, this clause is not applicable.
People get confused with the rounding of the service to 5 years for those who have completed 4 years and few months. This rounding off of years is applicable after 5 years completion. For example, if a person completed 5 years 8 months, then his total service becomes 6 years and not 5 years. So to get gratuity claim it is necessary that the employee should completed 5 years of service.
For your second query, though it is mentioned in the appointment letter, that the employee is out of purview of Industrial Disputes Act, the employer cannot deny the gratuity. It will not fall under the ID act. The gratuity is a separate entity. Whatever the case it has to be paid, except if the employee is terminated on account of misbehaving or any other acts of him caused a loss to the employer.
Hope this would clarify your query.
Regards,
Umesh.S.
From India, Bangalore
Thank u Mr. Umesh for ur reply. But I want to draw ur attention to one case law of Supreme Court which is as below:
Can a service of 4 years 10months and 11days constitute 5 years continuous service ?
"Yes, by virtue of the judgment of Supreme Court rendered under the provisions of the Industrial Dispute Act in Surendra Kumar Verma vs. Central Govt. Industrial Tribunal,[(1980) (4) S.C.C.433)], it is enough that an employee has a service of 240 days in the preceding 12 months and it is not necessary that he should have completed one whole year’s service. As the definition of continuous service in Industrial Dispute Act and Payment of Gratuity Act are synonymous, the same principal can be adopted under the act also and hence an employee rendering service of 4 year 10months 11days is considered to have completed 5 years continuous service under sec.24(2) and thereby is eligible for gratuity."
What is expert's view on it ?
Prakritish
From India, Calcutta
Can a service of 4 years 10months and 11days constitute 5 years continuous service ?
"Yes, by virtue of the judgment of Supreme Court rendered under the provisions of the Industrial Dispute Act in Surendra Kumar Verma vs. Central Govt. Industrial Tribunal,[(1980) (4) S.C.C.433)], it is enough that an employee has a service of 240 days in the preceding 12 months and it is not necessary that he should have completed one whole year’s service. As the definition of continuous service in Industrial Dispute Act and Payment of Gratuity Act are synonymous, the same principal can be adopted under the act also and hence an employee rendering service of 4 year 10months 11days is considered to have completed 5 years continuous service under sec.24(2) and thereby is eligible for gratuity."
What is expert's view on it ?
Prakritish
From India, Calcutta
Hi Prakritish,
It is really good information, with reference to the Supreme Court judgment.
Based on your Supreme Court case number I will study the case in detail and put my views in this regard. In general the judgment you have mentioned here says, even before the completion of five years of service i.e 4 years 10 months etc. by an employee is also eligible for getting the gratuity. Two years back I also faced the same situation. I have completed my service in a company 4 years 10 months, and as you said I was also informed somebody that I can claim the gratuity. But when I checked with a consultant, I was told that, rounding off will be done only after completion of 5 years.
Even, when we had a one to one discussion with Dy. Labour commissioner, few years back, we have been told that, if a person resigned a day before completion of 5 years, is not eligible for gratuity.
Now we need to find out exactly what law says. If it is as you told, then I am also eligible to get the gratuity from my previous company.
Let us wait for expert's comments on this. Meanwhile I will check the case law you have mentioned.
Regards,
Umesh.S.
From India, Bangalore
It is really good information, with reference to the Supreme Court judgment.
Based on your Supreme Court case number I will study the case in detail and put my views in this regard. In general the judgment you have mentioned here says, even before the completion of five years of service i.e 4 years 10 months etc. by an employee is also eligible for getting the gratuity. Two years back I also faced the same situation. I have completed my service in a company 4 years 10 months, and as you said I was also informed somebody that I can claim the gratuity. But when I checked with a consultant, I was told that, rounding off will be done only after completion of 5 years.
Even, when we had a one to one discussion with Dy. Labour commissioner, few years back, we have been told that, if a person resigned a day before completion of 5 years, is not eligible for gratuity.
Now we need to find out exactly what law says. If it is as you told, then I am also eligible to get the gratuity from my previous company.
Let us wait for expert's comments on this. Meanwhile I will check the case law you have mentioned.
Regards,
Umesh.S.
From India, Bangalore
Hi Prakritish,
I was searching the case law which you have mentioned in the website of judgments online of supreme court. The citation you have mentioned shows no result. Can you tell me where you got this judgment. Pls let me know the portal where you got it.
Regards,
Umesh.S.
From India, Bangalore
I was searching the case law which you have mentioned in the website of judgments online of supreme court. The citation you have mentioned shows no result. Can you tell me where you got this judgment. Pls let me know the portal where you got it.
Regards,
Umesh.S.
From India, Bangalore
Hi Umesh,
Pl. note that I got this information in a Law Book (Bare Act,2004) i.e. The Payment of Gratuity Act,1972 (Publisher: Law Publishers (India) Pvt.Ltd. 18A-S.P.Marg,Post Box-1077,Allahabad-211 001. Phone:623735,623741 Fax-0532-622276. email:
; website: lawpublishersindia.com).
Prakritish
From India, Calcutta
Pl. note that I got this information in a Law Book (Bare Act,2004) i.e. The Payment of Gratuity Act,1972 (Publisher: Law Publishers (India) Pvt.Ltd. 18A-S.P.Marg,Post Box-1077,Allahabad-211 001. Phone:623735,623741 Fax-0532-622276. email:
Prakritish
From India, Calcutta
I think someone who has completed
1. 4 years and 6 months (190 days = 1 year) where the company follows 5 day a week.
2. 4 years and 8 months ( 240 days = 1 year) where the company follows 5 day a week.
Is eligible for gratuity.The payment of gratuity ( second amendment) act, 1984 clarifies this. One needs to calculate the no of years and service completion as follows.
A company which follows 5 day week
Doj 1.05.2000 -
01.05.2000 to 30.04.2001 - worked for 190 days
01.05.2001 to 30.04.2002 - worked for 190days
If we go by the above formula and if the person does not have any break in service he will be eligible for gratuity on 01.11.2004
Regards,
P.Balakrishnan
1. 4 years and 6 months (190 days = 1 year) where the company follows 5 day a week.
2. 4 years and 8 months ( 240 days = 1 year) where the company follows 5 day a week.
Is eligible for gratuity.The payment of gratuity ( second amendment) act, 1984 clarifies this. One needs to calculate the no of years and service completion as follows.
A company which follows 5 day week
Doj 1.05.2000 -
01.05.2000 to 30.04.2001 - worked for 190 days
01.05.2001 to 30.04.2002 - worked for 190days
If we go by the above formula and if the person does not have any break in service he will be eligible for gratuity on 01.11.2004
Regards,
P.Balakrishnan
Dear Experts
I would like to clear one query ,in the case when employee has worked for l 4 years and 216 days ,would he be eligible for gratuity . i m looking for a refernce for supreme court decision regarding this .kindly help.
Pooja
I would like to clear one query ,in the case when employee has worked for l 4 years and 216 days ,would he be eligible for gratuity . i m looking for a refernce for supreme court decision regarding this .kindly help.
Pooja
Dear Pooja,
As my knowledge goes, the gratuity will be paid based on date of joining and completion of years of service. It is not based on 4 yrs and 216 days. If the person crosses 5 years of service within that 216 days, then he need to be paid, i.e, based on the date of joining of an employee, the day when he completes 5 years of service, he will be eligible to get the gratuity. But whereas the calculation will be rounded off to the next higher or lower fraction after his 5 yrs completion. So no one will be eligible to get gratuity if he is not completed 5 years of service.
The gratuity will be paid when an employee dies before completion of 5 years service, and will be paid to the dependent family member or nominee.
Regards,
Umesh.S.
From India, Bangalore
As my knowledge goes, the gratuity will be paid based on date of joining and completion of years of service. It is not based on 4 yrs and 216 days. If the person crosses 5 years of service within that 216 days, then he need to be paid, i.e, based on the date of joining of an employee, the day when he completes 5 years of service, he will be eligible to get the gratuity. But whereas the calculation will be rounded off to the next higher or lower fraction after his 5 yrs completion. So no one will be eligible to get gratuity if he is not completed 5 years of service.
The gratuity will be paid when an employee dies before completion of 5 years service, and will be paid to the dependent family member or nominee.
Regards,
Umesh.S.
From India, Bangalore
Hi All,
Due to rampdown of workforce our organization has planned to shutdown our division and thereby asked us to look out for other opportunities.
I have completed 4 years 11 months and 29 days (My last working day would be 29 June 2009 and My joining date in 1st July 2004).
What is the definition of "continuous service"? Whether am I eligible for Gratuity?
----------------Definition of continuous service ---------------
(2) where an employee (not being an employee employed in a seasonal establishment) is not in continuous service within the meaning of clause (1), for any period of one year or six months, he shall be deemed to be in continuous service under the employer - (a) for the said period of one year, if the employee during the period of twelve calendar months preceding the date with reference to which calculation is to be made, has actually worked under the employer for not less than - (i) one hundred and ninety days, in the case of an employee employed below the ground in a mine or in an establishment which works for less than six days in a week; and (ii) two hundred and forty days, in any other case;
Explanation : For the purpose of clause (2), the number of days on which an employee has actually worked under an employer shall include the days on which - (i) he has been laid-off under an agreement or as permitted by standing orders made under the Industrial Employment (Standing Order's) Act, 1946 (20 of 1946),
-------------------------------------------------------------
Due to rampdown of workforce our organization has planned to shutdown our division and thereby asked us to look out for other opportunities.
I have completed 4 years 11 months and 29 days (My last working day would be 29 June 2009 and My joining date in 1st July 2004).
What is the definition of "continuous service"? Whether am I eligible for Gratuity?
----------------Definition of continuous service ---------------
(2) where an employee (not being an employee employed in a seasonal establishment) is not in continuous service within the meaning of clause (1), for any period of one year or six months, he shall be deemed to be in continuous service under the employer - (a) for the said period of one year, if the employee during the period of twelve calendar months preceding the date with reference to which calculation is to be made, has actually worked under the employer for not less than - (i) one hundred and ninety days, in the case of an employee employed below the ground in a mine or in an establishment which works for less than six days in a week; and (ii) two hundred and forty days, in any other case;
Explanation : For the purpose of clause (2), the number of days on which an employee has actually worked under an employer shall include the days on which - (i) he has been laid-off under an agreement or as permitted by standing orders made under the Industrial Employment (Standing Order's) Act, 1946 (20 of 1946),
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