Emandiramesh
Manager-hr,ir&admin
Vijaya Chandra
General Manager
+1 Other

Dear HR Professionals

As we are all aware that every employee is eligible for payment of gratuity after completion of 5 years continuous service. And also the employee should be work for 240 days in a every year to get Gratuity for that year. In this regard my doubt is about the calculation of 240 days, in which what days we will be treated as actually working days. I understood as per Payment of Gratuity act,1972 the following days shall be treated as working days for calculation of 240 days. The formula as folows.
FORMULA I :
Actual Working days + laid-off days + earned leave + Maternity leave = 240 days ( 240 days or more than 240 days we have pay gratuity other wise less than 240 days there is no need pay gratuity for that year. )

1. Actual working days as per attendance abstract.
2. laid-off days under an agreement or as permitted by standing orders.
3 Days on leave with wages ( Earned leave)
4. Absent days due to temporary disablement caused by accident arising out of and in the course of employment.
5. In the case of a female, Maternity Leave days ( Not exceed twelve weeks)

FORMULA II :

II. Other than the above procedure i came to my notice the following procedure which is following in one organization to calculate 240 days for payment of Gratuity.

TOTAL WORKING DAYS (365 DAYS ) - LOP DAYS - ABSENT DAYS = 240 DAYS
( As per this formula 240 or more than 240 days has come he is eligible to get payment of gratuity for that year and as per this formula days will come less than 240 days he is not eligible to get gratuity for that year. is this practice correct or Wrong ? as per my opinion this is wrong as per gratuity act. PL suggest me correct procedure.

In addition to the above formula I my doubt is that the sick leave and LOP ( Authorized absence without wages ) should be included as working days for calculation of 240 days. PL CLARIFY.

I WOULD THANK FULL IF YOU PROVIDE ACTUAL AND CORRECT PROCEDURE FOR CALCULATION OF 240 DAYS FOR PAYMENT OF GRATUITY. IS THERE ANY SUPREME COURT OR HIGH COURT JUDGMENTS ON THIS TOPIC. IF ANY PL PROVIDE ME THE SAME.

REGARDS

VASIREDDY VIJAYA CHANDRA
SENIOR EXECUTIVE -HR
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24th February 2011 From India, Hyderabad
The above mentioned in wrong in my view. The period of 240 days does not come into play.
Look at secton 2-A of the Payemnt of gratuity act .The only stipulation is that the employee has to be in continuos service then he will be entitled to gratuity.Even if he has worked 100 days in a year he will be entitled to gratuity.
Only when section 2(1) does not come into play will sub section (2) which stipulates 240 days come into play.The judgement of the madras high court is wrong in this matter.
17th October 2011 From India, Bangalore
Dear Vijay For gratuity eligiblity 5y, required in a.p. 4.8(4y,,+240 working days ) required in madras. if any doudt call me. Thanks&Regards E.Ramesh eramesh_82@yahoo.co.in
19th October 2011 From India, Hyderabad
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