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An employee in a company had served for 6 year and had resigned the organisation after serving for 6 year in 2011. The company had sent him a notice asking him to resume the job otherwise job would be terminated and accordingly job of that person was terminated. But the gratuity remains unpaid of that person. In this case what would be the implications or liability for non payment of gratuity.
From India, Mumbai

Payment of Gratuity Act does not authorize employer to with-hold Gratuity of employee for any reasons such as negligence and unauthorized
leave except where services of employee are terminated for any act of willful omission or negligence which caused any damage, loss or destruction to employers property or for riotous or disorderly behaviour or for any act which constitutes an offence involving moral turpitude committed in the course of employment.
Incase non payment of gratity by employer he has to face following consecuences.
Imprisonment for a term which may not be less than 3 months and may extend to 1 year or with fine which may not be less than Rs.10,000/- and may extend to Rs.20,000/- or both.
Arun J.

From India, Hyderabad

The Employer is bound to pay the gratuity in the present case. no other option is available under the law.
From India, Pune
Thank You sir for you reply Company is ready to pay but how and to whom to be paid as the employee is not approaching toward the company for his gratuity payment. Regards, Sonam
From India, Mumbai

Dear Sonam,
The employee is eligible for gratuity & the company needs to release the amount of gratuity. If the employee is not approaching to the company, the company may send him a registered letter explaining the situation / employee's benefit and request him / her to to receive his gratuity.

From India, Mumbai

I agree with Prabhat. Its Employers moral duty to intimate the employee about his gratuity. if he doesnot approach then deposit his graduity in his A/c.
From India, Hyderabad

Dear Members
In my view there is a provision in the act which states that the employee or his authorised representative / nominee has to apply to get the gratuity amount and the employer has to pay it within stipulated time (30 days) on receipt of the application."Section 7"
In normal circumstances the employer pays it to the employees without even taking a formal application but in the cases where the employee is absconding or in cases of death it is in the interest of the employer to get the documentation done properly before releasing any payments.
Preetam Deshpande

From India, Mumbai

Dear Sonam,
Gratuity is to be paid to the nominee only in case of death of the employee. if the employee is absconding employer can not pay the grauity to the nominee on its own.
If the employee is not traceable and if you have all proof of the same then deposit the grautity amount with the Controlling Authority.
The Gratuity Act cearly provides an option to the employer of depositing the gratutity amonuth with the Controlling Authority in case of any dispute including when there is a dispute 'as to the person entitled to receive the gratuity'.
If you delay the matter you have to pay interest on the payable gratutity amount.
Trust your doubts are cleared.

From India, Pune

Following is the provisions under Payment of Gratuity Act 1972 for non payment of gratuity:
(1) Whoever, for the purpose of avoiding any payment to be made by himself under this Act or of enabling any other person to avoid such payment, knowingly makes or causes to be made any false statement or false representation shall be punishable with imprisonment for a term which may extend to six months, or with fine which may extend to 1[ten thousand rupees] or with both.
(2)An employer who contravenes, or makes default in complying with, any of the provisions of this Act or any rule or order made thereunder shall be punishable with imprisonment for a term 2[which shall not be less than three months but which may extend to one year, or with fine which shall not be less than ten thousand rupees but which may extend to twenty thousand rupees, or with both]:
Provided that where the offense relates to non-payment of any gratuity payable under this Act,the employer shall be punishable with imprisonment for a term which shall not be less than six months but which may extend to two years] unless the court trying the offense, for reasons to be recorded by it in writing,is of opinion that a lesser term of imprisonment or the imposition of a fine would meet the ends of justice.
So, clear his gratuity payment as soon as possible.

With Regards,
Vineet Deshmukh

From India, Yavatmal

Dear Sonam,

I have seen the replies of senior members with various suggestions giving references of varied solutions besides penal provisions applicable in case of non-payment of gratuity under Payment of Gratuity Act 1972. You are advised to take following steps to obviate the blame for the non-payment for the gratuity to the individual:-

(i) Calculate the amount of gratuity payable to the Individual and send a notice in the prescribed form to him, on the present & permanent addresses as recorded in his service book or available in any of the records, with a copy to the Controlling Authority of the Area specifying the amount of gratuity so calculated.

(ii) Simultaneously write an application to the Controlling Authority of the Area showing your willingness to deposit the amount of gratuity in respect of the individual with the Authority or obtain permission for the delayed payment on the ground that the individual has not claimed the amount of gratuity,so that you get an immunity from paying the interest on delayed payment of amount of gratuity later on.

(iii) As an extra precautions, you may display a copy of notice on your notice board so that a word is spread to him through his colleagues.

BS Kalsi

Member since Aug 2011.


From India, Mumbai
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