try to be proactive and supportive of the people you are letting out - be detailed in giving them their FnF, service certificates, PF details, and all such relevant documents. Slip ups will only create avoidable long term complication and heart aches
Gratuity is to be paid to all employees who completes 5 or more years of service calculated as follows;
monthly salary /26*15*No of years of service.
Retrenchment compensation is to be paid only to workmen who completed 1 or more years of service calculated as follows;
15 days average wages* No of years.
In addition you have give one months notice to workmen or wages in lieu there of.
If the workmen submit resignation you do not have to pay Retrenchment compensation.
The other thing that I want to suggest is thatl, if an owner is aged, closing the running company is not the solution but the owner should hand over the responsibilities to one of the trusted person who can run the company successfully.
As of now, Ratan Tata is aged now but he can not think of closing the company but to handover it to a eligible and trusted person as there's so many people are employed by his companies.
It's also not the matter of small or big company but thinking about the future of people who worked for you for so longer whether it 2 people or 2 crore or more.
I am working with a company since 2011 now due to financial crunch company is sinking and under control of lenders. All top officials from HR also left. I am not sure that while leaving the company I will get gratuity from company, though the fund was made . Is there any legal actions to be initiated. One of hard part of it, company is also referred to NCLT.