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Respected forum members,
I have gone through many discussions on our forum regarding the subject matter and reading comments supporting yes as well as no...
I am stucked up in such a situation now... I am leaving my present employer upon completion of 4 years and 11 months... The company is saying that they will pay gratuity only upon the completion of 5 years... The company claims that as per Payment of Gratuity Act and Rules, 1972, 240 days of service shall be considered as a continuous service for the year only in the case of death...
What is the actual fact...? Is there any possibility as per gratuity rules for me to get gratuity...
Kindly suggest in this matter…

From India
Dear Mr. Dipil
As per Gratuity Act the gratuity will be paid for those leaving the service on completion of 5 years of service. In case of Death, Retirement termination and Retrenchment the company has to pay the gratuity for those who have put up 4 years and 240 days continuous service in fifth year. But for Resignation the company will pay the gratuity only for those who have completed clear 5 years of service.
Please refer https://www.citehr.com/77167-gratuit...ive-years.html thread in which Chennai High Court has given direction to pay for those who have completed 4 years and 240 days. The chennai high court rulings will be considered in the jurisdiction of Chennai High Court only and not in other jurisdiction.
Let us wait for other seniors to reply in this query.

From India, Kumbakonam
Dear Shri Bhaskar,
Thanks a lot for providing valuable information on payment of gratuity in general and Madras High Court ruling on the subject matter published by Shri Lal in particular. Its a great news to all. I think people residing out side Tamil Nadu can get the advantage of the ruling from their respective organisation.

From India, Mumbai
Dear Sir
Thanks for your inputs on the subject matter...
Still it is not clear... In your reply itself both the answer is coming... Yes as well as No...
I am looking to get final word/solutions from this forum... If yes I can talk to my company, if no why should I indulge in a discussion unnecessary with the employer...
Once again request to senior members to help me out in come out from this scenario...

From India
Yes, you are eligible for Gratuity if any employee has completed 4 yrs & 240 days is eligible for Gratuity as per Gratuity Act.
From India, New Delhi
Lot of discussion held on this forum regarding applicablity of gratuity.in my view 5 years is must for applicablity of gratuity.in one case madras high court has given judgement and said if 240 days is complete in fifth year than gratuity will be applicable but we can not take judgement as a law.
so five years is must to get gratuity.

From India, Delhi
Dear Mr Dipil,

According to me you are not eligible for gratuity in view of specific provision contained in Section 4(1) of Payment of Gratuity Act which requires completion of 5 years of continuous service.

Madras High Court decision is binding only in the State of Tamil Nadu. Other States are not legally bound to follow that decision and can have a different view. There is no decision of Supreme Court on this specific issue. However, in the case of In Grand Kakatiya Sheraton Hotel and Towers Employees and Workers Union v/s Srinivasa Resorts Ltd., reported in 2009 5 SCC 342, the Supreme Court upheld the judgment of the Andheri Pradesh High Court, by which that court had struck down as unconstitutional the provisions of the Andhra Pradesh Shops and Establishments Act by which gratuity was made payable even to employees who had not completed 5 years service as per the Payment of Gratuity Act, 1972. In para 47 of its judgment, the Supreme Court held as follows:

“47. It is already held by this Court time and again that the concept of gratuity as conceived in the Payment of Gratuity Act and even earlier to that in labour jurisprudence is that gratuity is a reward for long and continuous service. It is for the first time by that Act, a worker or an employee was made entitled to the gratuity by his rendering continuous service for five years. If this is so, then providing only one year for entitlement to get the gratuity, is certainly unreasonable."

Although the specific question raised in the query was not considered in any judgement of the Supreme Court, the approach adopted supports the view that the minimum qualifying period of 5 years as prescribed in the Act should receive a strict construction.


From India, Malappuram
Madras High Court has held that it is payable. There is no ruling by SC as noone has taken up this issue. In the absence of any judgement by any High Court, lower authirities may be guided by a Judgement of any Hight Court
In my opinion, you can make a claim
T Sivasankaran

From India, Chennai
Dear All
Thanks for guiding me... Really it's a critical situation...Still 50-50...
Thanks for the suggestions... However I am not going for a legal fight with the company... With all the facts gathered from these discussions and discussions in other forums, surely going to give a formal request to the management... If they give it's ok, or else!!!
Once again thanks....

From India
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