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Hi All,
As per gratuity act, if an employee completes minimum 5 years of continue service he is eligible for gratuity. [please correct me if wrong]
My question is if an employees completes 4.6 months of continue service, whether he is eligible for gratuity or not. please guide me urgent.
Regards,
Kanaka
From India, Madras
hi kanaka,
going by wat i know n remember of the gratuity act -
1) yes, 5 yrs of continued service makes a person elligible for getting gratuity
2) 4.6 yrs means he/she has not completed 5 yrs.
the rounding off after decimal happens after 5 yrs r complete - that is to say - 5.3 yrs = 5 yrs (for calculation purposes)
5.7 yrs = 6 yrs (for calculation purposes)
this is as far as i know, i wud like the senior members to confirm.
Cheers,
Pallavi
From India, Pune
Hi
Pallavi,
Thanking you for your reply. Because my consultant told that if an employee completes 4.8 months of continue service he is eligible for gratuity.
Anyway now I am clear.
Thanks lot
bye for now
kanaka
From India, Madras
Hi, 5 years of completion is must to get the gratuity amount from employer. if it is 4.9 years we will considerd as non completion of 5 years this is for your information. regards Sambasiva Rao

Dear Kanaka:
What you have mentioned regarding the payment of gratuity in case of completion of 5 years true to the best of my knowledge.
To the best of my knowledge: Madras high court has held that an employee rendering continuous service for a period of 240 days in the fifth year will be deemed to have continued in service for 1 year (completion of 5 years). That is, 4 years 10 months and 18 days if completed he/she is liable for Gratuity.
In one of the reference books, its clearly mentioned that 4 years 6 months is considered as 5 years and hence the employee is entitled for gratuity.
Hence kindly re-check.
From India, Thiruvananthapuram
hi all,
as far as i know gratuity is given only after completion of 5 yrs. not less than that.
but i had another query ... is the time of probation also included in the calculation of gratuity?
... as in if a person is on probation for 6 months, so will the gratuity be calculated from his/her date of joining or from his/her date of confirmation?
Regards,
Pallavi
From India, Pune
Yes, the probation period will also be included for payment of gratuity. The Payment of gratuity act speaks about continuous service of 5 years. It further clarifies the days to be included where a person is not in continuous service. Please be clear that gratuity will be calculated from the date a person has joined his service and not from the date of confirmation.
Cyril
From India, Nagpur
Hi Kanaka,

ur question is quite an intelligent one.

What the Payment of Gratuity Act says is that "Those persons who have completed their five yrs of continuous service, they r being entitled for the payment of gratuity".

Actually in the real sense, the gratuity is being paid to the employees for their faithful continuous service in the company.

As per ur question, the time period of service is 4.6 yrs, which is for the calculation purpose is considered as 5 yrs. If the provision will be like this, then he/she is eligible for the payment of gratuity.

As per the Act, a person can also be entitled to payment of gratuity though he/she has not completed the period of continuous five yrs, in a condition that-

1) If he/she is discontinued his/her work on account of permanent disablement, or

2) on account of his immature death.

In these above two conditions, he/she is entitled to get the payment of gratuity though he/she has not completed his/her five yrs of continuous service.

But, out of my concern, what i thing is that the person is not qualified for the payment of bonus. The period of 4.6 yrs will not be considered as 5 yrs for the calculation of gratuity.

Santosh Dash.

M.A in IR & PM,

Berhampur University,

ORISSA.

I agree with Vidya i have read this judgement of Madras High Court in one of the issue of LLR.
From India, Delhi
Dear All
i am new to this site.This site is really helpful to improve HR Skills.
Reg. Gratuty i've few queries on eligibility criteria.
a) is it from the date of join or from conformation date?
b) Suppose EMP dies oneday after joining. Is he eligible for Gratuty.
C) For computing 5yrs services, do we count sick leaves as service period.
Please kindly help me.
Kind Regards
G V Anil Kumar
From India, Hyderabad
Dear Friends, The caleculation for Gratuity is very easy: BASIC + DA (Last Pay drawn) X 15 /26 X No.OF YEARS WORKS. Clarification please see the attatchment Regards, PBS KUMAR
From India, Kakinada

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i am sory to correct you. but with my whole reseach on it and goin thru the act it is said that if employee has completed 240 days of the fifth year then he is eligible to get gratuity for 5 years.
thanks
ally

As per the provisions prevalent in Payment of Gratuity Act, 1972, an employee becomes eligible for gratutity after completion of 5 years service. You are very right in this aspect. As asked by you whether person who have completed 4 years six months will be eligible for gratuity or not. Since, the employee has not completed five years, hence not eligible for gratuity at all according to the provision exists in the Act.
GK Sharma
MA, LL.B, PGDPM & LW

DEAR MR SHARMA, KINDLY GUIDE ME ON DELAYED PAYMNET OF GRATUTY BY 1 YEAR, IS THEER ANY PENALTY ? INTEREST(AS PER THE ACT YES) ? IF YES WHAT IS THE RATE OF INTEREST OR PENELY. REGARDS JOSEPH
From India, Mumbai
Under the Payment of Gratuity Act, 1972, an empolyee becomes elegible for gratuity at the rate of 15 days per year after the completion of five years.
So, you are very right that the minimum length of services for payment of gratutity is 5 years.
The period 4.6 years can not be treated as five years. Hence not elegible for the gratutity.
(G K Sharma)

I am in a similar situation , i have resigned and on my handing over day am completing 4yrs 6 months 10 days, now i am anxoius to know am i eligible for gratuty or else it is mandatory to complete 5yrs , rounding off is only for calculation of the amount.
From India, Bangalore
Hi,
Pls note completion of 240 days of continued service is MUST to avail gratuity. Also an employee becomes eligble under conditions specified in the act (Ref Mr. Santosh`s post above)
Be it training period / probation period / maternity leave / paid holidays / compensatory holidays - all are taken into consideration for this purpose.
Pls correct if I am wrong.
-Saravana Rajan. S
From India, Mumbai
Hi Praveen, If an employee leaves anytime between 4.6 years to 5yrs, it will also be considered as 5yrs of service for the purpose of calculating of Gratuity.
From India, Mumbai
Hi As per Act / Gratuity Calculation If a person complets 4.5 Yrs of service He/ She is eligible for Gratuity . If pls refer Regards Ramlingam.V
From India, Madras
Dear Employee who completes 4.5 Yrs of continous service , were eligible for Gratuity . Reagrds Ramalingam.V
From India, Madras
As per the basic Act, one who has even one day short to complete 5 years is not eligible for gratuity. The matter of 240 days is taken only to decide continuous service. As such one who had 240 days of work (inclussive of leave due to employment injury, CL, ML, lay off etc) in a year shall be treated as having continuous service. This is to protect such employees who may not be regularised by the employer to deter so many rights in the law. There is also some misconception that only confirmed employees are eligible for gratuity, EPF etc. That's why a provision has been made to interpret 'continuous service' by reading 240 days of service. But this is not applicable to death cases, where as one member asked, one who dies the very next day of his service will get gratuity; but the amount of gratuity will be to that extend only.
However, there are court verdicts (Madras HC and Delhi HC) allowing gratuity to employees who have not completed 5 years of service but on the basis of their 240 days of service in the fifth year.

Regards,

Madhu.T.K
From India, Kannur
Dear Mr.Madhu,
Its a clear and informative info.
But I find in this forum, THE LATEST POST APPEARS AT THE LAST PAGE (PLS CHECK IT FOLLOWS AN ASCENDING DATE ORDER)
It would be better if the latest post appear on the top (descending date order)
Request you to pls check if something could be done on this.
-Saravana Rajan
From India, Mumbai
I had also experienced the same case where Company didnt pay the Gratuity to the employee left the org after 4 yrs 10 months of regular service. I personally not convinced with this, since its was only 2months to go to compleate the 5 yrs.
Can somebody advice if he can go back and ask his Gratuity from the previous employer? Its a recent incident.
From India, Bangalore
Dear..
Can someone also please clarify on the Gratuity ceiling of Rs 350000/-. One of our employee has completed 8 years in the organisation. His gratuity figure is much higher than 350000/-. As per the law Company has an option to pay either 350000/- or the total amount. Seniors please let me know if my understanding is wrong
Warm Regards
Smita

Gratuity Maximum limit that Employer will pay Rs.350000 as per the act. if the employee gratuity payable exceeds this limit, we may restrcit up 350000/- we need not pay total amount. Raghu
From India, Hyderabad
Hi,
You can tk a look at the foll URL. Hope it'll be of sm help
Calculate Gratuity
Warm Regards
Moumita
From India
Gratuity Calculation Basic + DA (Last drawn) X 15 / 26 X No of years of service. -Saravana Rajan
From India, Mumbai
maximum period of service to be eligible for gratuity is 5 years.. companies have the liberty to pay gratuity for lesser years of service also 2/3 years.. this however, has to be explicitly stated..

Hi ,
I am working in IT firm and after completing my 6 year of service I have been transfered to US office head office on L1 visa. Here I have been joined as a new employee no connection or link/benefit etc. releated to India office.
I want to know whether i am eligble for Gratuity fund or not.
Regards,
RS
From United States, Marietta
If your transfer to US Office is not in continuation of your service in India, your services in India are supposed to have been terminated. As such you are eligible for Gratuity. On the other hand, if your posting is only a temporary arrangement with a condition that you will be posted back in India, it will be presumed that you are still in service. Therefore, study the transfer order in detail and act accordingly.
Regards,
Madhu.T.K
From India, Kannur
Dear all
As far as my knowledge is concerned, a person is eligible for Grautuity only if he/she has completed 5 years of continuous service. But recently i heard about a court order that if a person completes 4.6 years of service, is eligible for Gratuity. Kindly correct me if otherwise. if not could anyone can send/publish the court order please.
Thanks and regards
Meena Kumar V
From India, Ernakulam
An Employee with Basic Salary of Rs.11000/- per month (No DA) expires completing 2.5 Yrs of Service (Exactly 30 Months). Before that he was absent for 2 months on account of Accidental Injury. Kindly Help me in Calculating His Gratuity
(BASIC) X (15 /26) X No. OF YEARS WORKS (2 OR 3)
Kindly Help
From India, Delhi
The employee was on leave for two months immediately preceding the date of death. If that leave was a sanctioned leave with pay he is deemed to have completed 2.5 years. It is stated that any fraction of leave beyond six months (which shall mean at least one day over and above six months) shall be treated as one year. However, being a death case, it is advised to calculate gratuity treating the six months as one year and as such the amount of gratuity shall be Rs 19038 calculated on the basis of 15 days pay for three years. On the otherhand, if two months leave was absence without pay, naturally, the legal representatives of the deceased will receive only two years gratuity since the employee had only 2 years and 4 months service with the establishment. Regards, Madhu.T.K
From India, Kannur
Thank You Madhu for your Help.
He was on approved leave but as his leave balance was not there so no salary was being paid. I skip to mention that he joined the Duty one month before expiring. So his service is 2 Yrs 3 Months + 2 Months Leave without pay (Due to accident) + 1 Month Duty
Kindly give your guidance under new facts
From India, Delhi
Normally, loss of pay will be treated as service interruption and if you look at the definition of eligible service for gratuity, it should be uninterrupted service which includes days on which he was laid off, days for which he was under medical leave following an employment injury, days on which he was on approved leave (with pay), maternity leave in case of women employees etc. Therefore, 2 months of leave without pay will not count for his service and qualify for gratuity. Under this circumstance, his heirs are to be paid gratuity for 2 years only. As already stated in my previous post, it depends upon company and there is no law which prohibits from paying anything more than what is stated in the statute and , therefore, if the company desires to pay 3 years gratuity on humanitarian grounds, follow that. But remember that privilege once given can not be withdrawn easily as privileges become right!! Regards, Madhu.T.K
From India, Kannur
in my organisation one person is completed his service 27year, 5month, 24day. how to calculate the gratuity
From India, Pune
My question is if an employees completes 12years and 5 months of continue service, whether he is eligible for gratuity in 12.5 years or 12 years please Guide Me Urgently.
From India, Nasik
He will be entitled to get gratuity for 12 years only. In the case of Bharat, the gratuity will be restricted to 27 years. Regards, Madhu.T.K
From India, Kannur
Can gratuity be withdrawn by a person after completing 5 years of service but before retirement or resignation, if an employee requests.
From India, Shimla
Anonymous
Date of joining is - 06/09/2005
last working days - 08/04/2011
Basic salary is - 25000
How much is gratuity
What we will consider 7 ys of service of 6 yrs of service
From India, undefined



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