Industrial Relations And Labour Laws
Korgaonkar K A
Hr - Manager
As per the Act it say 4 years continues service & 240 days working in the 5th Year.
In the Act it is clearly mentioned about the continuous service - If he has been on leave with full wages. ( Leave should be taken into consideration).
Coming to 240 days , if you are 5 days week working = 365 day (in a year ) - 52 (weekly offs Sat & Sun) - 11 (national holidays/festival holidays) = 302 days total working in that year, then the person has to be worked for 240 days in the 5th year (includes Leave + National / Festival holidays declared by Organization).
In Gratuity Act 1972 , continuous service has condition such as - for accident while on duty & for female on maternity leave to considered as continuous service.
14th August 2015 From United Kingdom, London
Now coming to continuous service, 240 days working is considered as continuous service and that is required in each year and not just in the fifth year. The year is taken as 12 months preceding the day of exit. That means, if you leave in August, your service backboards will be counted. For deciding whether an employee had worked for 240 days, all paid holidays, weekly off days and leave days and days on which he had been laid off will be counted as days worked. For persons in the establishments which work for less than 6 days in a week, the mandatory 240 days will become 190 days. This is so for those who are working below the ground (of mine)
There has been a lot of discussions and disputes with regard to gratuity eligibility of employees who leave organisations after working for four years and 240 days in the fifth year. Though some judgements say that completion of 5 years is mandatory for eligibility for gratuity, some other judgements, like that of Mettur Beardsell Ltd vs Regional labour Commissioner (1998 LLR 1072) and very recent judgement by Kerala High Court in Sreeja Vs Regional Joint Labour Commissioner (2015 LLR 826), have taken the stand that working of 240 days over a period of 12 months would constitute continuous service for that period and therefore, even if any employee has not put in 5 years of service but has put in 4 years (with each year with 240 days) and 240 days in the fifth year, he is entitled to gratuity.
14th August 2015 From India, Kannur
Thanks for your inputs.
I am considering 12 months from date of joining and not from date of exit. I do not know what is correct.
I would like to add here. This may be applied in the state of Tamil Nadu and now in Kerala. Rest, one has to make similar case law if the employer is not agreeing. Hope you will agree with me.
14th August 2015 From India, Mumbai
There is nothing wrong in considering a state ruling for another. Similarly, a High Court ruling can be considered in another state also. In the case of payment of Gratuity, since there was no amendment taken place in the Act considering these judgements, other states may plead that the ruling is not binding on us. There can be different interpretation for it by other judges. Even an employer can interpret the Act in the same way in which the Tamil Nadu or Kerala High Court has interpreted.
17th August 2015 From India, Kannur