Madhu.T.K
Industrial Relations And Labour Laws
R.N.Khola
Labour Laws & Ir
Kumaresank
Labour & Industrial Laws
Generalist91
Generalist Role
Sandy1701
Anu Product Ltd
+5 Others

I want to know if a employee completes his 5 years of service and he is asked to leave the organisation does he is eligible for gratuity and how much?
And if he resigns what gratuity he is eligible for ?
Please inform me.
Rajesh Dave
Naturell India Private Limited
Mumbai
09324087042
23rd June 2009 From India, Mumbai
Under both situations he is entitled to get gratuity. However, if his services are terminated for gross negligence (means he is dismissed) then gratuity shall not be paid.
The amount of Gratuity is equal to 15 days salary for every completed year of service.
Regards,
Madhu.T.K
24th June 2009 From India, Kannur
Dear Dave,
There is no legal provision asking an employee to leave. Either employee leaves or he is sacked.
Gratuity can be forfieted only in case of discontinuation of employment as a punishment for theft, fraud, dishonesty, any behaviour amounting to moral turptitude (assault/ rape/ attempt of molestation etc).
Gratuity calculation is (Last drawn Basic+DA)/26 X 15 X No of completed years of service
Here, we need to consider service above 6 months in the last year as next complete year.
However this adjustment is subject to completion of 5 years of service.
Regards,
Generalist 91
29th June 2010 From India
Employee dismissed from service will be eligible for Gratuity provide that he had completedly 5yrs of continous service and the cause of dismissal is not excluded by Gratuity Act.
29th June 2010 From India, Tiruchchirappalli
I wish to know the gratuity law is implied to the teachers as well. But over the years no graduity fund is collected. Moreover, the school can not charge etra in the name of gratuity from the students.
In this case what is the procedure of paying gratuity?
Regards
Shanti Prakash
19th July 2010 From India, Bhopal
Kindly help
I have a quiry
The school that has not collected any money for gratuity and the new law of grauity applies to the school teachers as well.
How should I go about it?
Thank you
Fr. Shanti Prakash
19th July 2010 From India, Bhopal
Shanti kindly understand that Gratuity fund is not collected/deducted from the employees salary. In otherwords, its Gratitous amount give to employees for his/her continous unblemished service to the organization. It is purely the employers contributions for the employees Gratitous service. So it can be enacted/ordered to given by the competent authority.
20th July 2010 From India, Tiruchchirappalli
Dear MR Dave

The employee who completes 5 years service is not only cretiria for the payment of gratuity. He should also requires to work for more than 240 days in every year and should have continuous service for 5 years. In such a case, the employee is entitle for gratuity.

When the employee commits misconduct resulting financial loss to the organisation, then only the company has rigtht to forfiet the gratuity payable to him which is equelent to the loss so caused to the organisation. Generally, in other cases, where the employee dismissed or discharged for the proved acts of misconduct like absenteeism, sleeping whilest duty and gross neglegence etc, the employer cannot forfiet the gratuity payable to such employee.

Wether the employee resigns or he was asked to resign doesnot make any difference for the payment of gratuity. If he fulfils the conditions as stated above, the gratuity is payable at the rate of 15 days average pay for each completed year of service. In the formula for payment of gratuity is = Salary last drawn %26 days X 15X number of years of service.

Regards

NVRao

Hyderabad
26th August 2010 From India, Hyderabad
I was terminated from service of the Company without assigning any proper reasons. I have 18 years of service and 13 years service left for retirement. In such a situation can I claim gratuity for 31 years?
30th September 2013 From India, Trivandrum
Dear Sir, Once the gratuity is applicable, it is the lookout of the employer as to how the finance is to be raised.
30th September 2013 From India, Pune
Dear Member, Welcome to CiteHR. You are entitled to claim gratuity only for 18 years of service rendered by you in accordance with the Payment of Gratuity Act, 1972. Regards, R N KHOLA
30th September 2013 From India, Delhi
Dear Sir, i have completed 2 years 8 months in a company,but due to the project closure , companyy has given me the de mobalization letter informing me that there is no suitable vacany available in other project. for me also they are denying to release the graduatity for the 2.8 years .can you please help me in getting information regading the my graduaty recieving rights/or elligliblity for the .
27th June 2015 From India, undefined
In order to be entitled for gratuity, you should complete 5 years of service. Since you have only 2.8 years of service with the company, you are not entitled to get it. Of course, if you were employed not in supervisory or managerial role, you should be eligible to retrenchment compensation as per Industrial Disputes Act. Retrenchment compensation is equal to 15 days pay for every completed year of service and any fraction of year over 6 months.
Madhu.T.K
4th July 2015 From India, Kannur
Dear Seniors,
Please help me with your valuable suggestions on the following query:
One of our permanent worker is terminated for a theft case which was caught red handed and took the steal item back by the management . He was immediately show-caused with suspension. In his reply to the show-caused notice he admitted his allegation leveled on him. There was nothing financially loss to the organisation by his crime. Now, can management stopped his gratuity or deduct part of his gratuity amount as punishment after termination. Please advise.
28th November 2016 From India, Delhi
Since there is no loss caused to the organisation you can not quantify or decide the amount of loss. But even if you have not incurred a monetary loss you can impose a 'fine' as punishment. However, such fines will not come under permissible deduction or the amount which can be forfeited as per section 4(6)(b) of the Payment of Gratuity Act. You can impose a fine as punishment and recover it by deducting from the salary payable but not from the gratuity. The amount of fine should be as per Payment of Wages Act. Please refer section 8 of the Payment of Wages Act for details in which it is stated that fine should not exceed an amount equal to 3% of the wages due.
Madhu.T.K
29th November 2016 From India, Kannur
Thank you very much for your reply and suggestion. It has cleared my doubt of gratuity deduction. Thanks again.
1st December 2016 From India, Delhi
one of our employee completed his 9 year service and he want to get his f & f along with gratuity
after received all this he again demand to continue his job as a new employees in that case he is eligible for all this.
12th March 2018 From India, Faridabad
Is this a purposeful arrangement between the employee and the employer? If not, do not allow him to rejoin, let him resign take the gratuity etc and get relieved. Such kinds of employees will be dangerous employees.
13th March 2018 From India, Kannur
Hello everyone,
I'm a contract employee in one organisation and I have completed 3 years 7 months 1 day and due to project technical issue in client location got terminated and again project allocated with gap of 10days and hired as new employee for the same organisation and same project than i completed 1 year 1 month 7 days in the same organisation, so now it would be break in service for 10days without my fault with the organisation.
Excluding my 10days break in service total employment with same organisation is 4 years 8 months 8days, Can you guys please suggest me
I'll be eligible for the gratuity or not.
8th August 2019 From India
EMPLOYEE'S RIGHT TO GRATUITY
The Act by recognizing the right of an employee to claim gratuity, leaves no discretion with an employer to make payment of gratuity dues to an employee at his own sweet will, which has to be mandatory paid, provided the Act is applicable on the concerned employer. Any failure to make payment of gratuity dues, is punishable with imprisonment for not less than six (6) month and which may further be extended to two (2) years.
Continuous Service
According to Section 4 (1) of the Act, gratuity is payable to an employee on the termination of his employment after he has rendered continuous service for not less than five (5) years on his superannuation or on his retirement or resignation or on his death or disablement due to accident or disease. Section 2-A (1) of Act defines the term 'continuous service'. The courts in India have time and again observed that the definition of 'continuous service' has to be interpreted liberally. Further, the said provision clearly indicates that cessation of work not due to any fault of the employee is not to be treated as creating any interruptions in course of continuous service. Section 2-A (2) of the Act, further stipulates that an employee shall deemed to be in continuous service for a period of one (1) year if during that period of one year he has actually worked under the employer for a period of 190 days (if the establishment works for less than six days in a week and 240 days
EMPLOYER'S RIGHT TO FORFEITURE
Section 4 (6) of the Act permits an employer to forfeit gratuity payable to an employee in the certain circumstances. As per the said provision:
✓ The gratuity of an employee, whose services have been terminated for any act, willful omission or negligence causing any damage or loss to, or destruction of, property belonging to the employer' shall be forfeited to the extent of the damage or loss so caused;
✓ The gratuity payable to an employee may be wholly or partially forfeited (i) if the services of such employee have been terminated for his riotous or disorderly conduct or any other act of violence on his part, or (ii) if the services of such employee have been terminated for any act which constitutes an offence involving moral turpitude, provided that such offence is committed by him in the course of his employment.
9th August 2019 From India
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