Consultant-Management & HR Services

Dear Professional Colleagues:

I want to share the following points to the above debate:

Act to override other enactments, etc.

14. The provisions of this Act or any rule made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than this Act or in any instrument or contract having effect by virtue of any enactment other than this Act.

The above is particular info to colleague that the Indian Contract Act or any other Civil Act does not apply to gratuity amount payable, and no SET OFF can be made against dues from employee, in particular towards short of notice period.

The following would add significance to what I am highlighting:

1) No amount of gratuity can be adjusted / forfeited against the dues of the employee except on the grounds

available under sec. 4(6) of the Payment of Gratuity Act.

Caselaw: Harrisons Malayalam Ltd. vs. Balan. 2009 (123) FLR 862

(Kerala HC)

2) Even when a guarantor for loan has agreed that the amount of loan, if not paid can be recovered from terminal

benefit, it cannot be recovered from gratuity and provident fund.

Caselaw: Kunju Mohammed vs. Kerala State Financial Enterprises Ltd.

2010(1) KLT 56 (Kerala HC)

Simply put it, Gratuity is payable in full, without adjusting for any contractual failures by employees, other than adjusting/forfeiting towards proven misconduct/ proven loss caused to the establishment. (short of notice period does not fall into this category).

In so far as short of notice period by employee is concerned, Employer has to use other win-win methods, hinted by experienced colleagues hereinabove.

Hope these notes useful.

With Best Wishes,

Ravi Naidu

From India, Bangalore
Partner - Risk Management

Gratuity is payable only after 5 years work
Your friends bond can't be 5 years long.
So where is the question of setting off gratuity against bond money.
PF is a protected investment. It can not be confiscated or attached or held back even by order of court. In any case, PF is to be settled directly by the PF department, the company has no say in it anyway.

From India, Mumbai
gopinath varahamurthi
MindHour Partner, Ass.Professor/Adm. Officer, SKCE, Arakonam

None can recover single penny from PF/Gratuity it is the amount pertain/belong to the employee and not the employer. All settlements need be done with due concern of the employee and employer according to the available procedures. The most sought is the recovery of amount rest can be settled.
From India, Arcot

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