Legal Analyst, Hrm
Ngo Kastaharan (for Legal Help )
Gm (hr)
+1 Other

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Dear All,
Please make me understand about the Gratuity payment in the following case.
A employer have two companies. A employee has worked with first company for 3 years and get his full & final amount than join the employer's second company and worked there for more than 2.5 years. Will he be entitled for gratuity for continues service under same employer?

From India, Mumbai
Dear Sandeep in my view the employee is not entitle for gratuity as his services were not transferred from one company to other and he has taken full and final in earlier company and joined again
From India, Delhi
Thank for your reply Malik Sir.
I was reading about frequently asked questions on gratuity. there employee is eligible for his continues service under same employer. Sir is not detailed clarification in the rule of gratuity. So its depend on situations.

From India, Mumbai
You are not eligible for gratuity. May be of the same group, but legally both the entities are different.
About your doubt, "is not detailed clarification in the rule of gratuity," the company law cannot be the part of the Payment of Gratuity Act, you may have to refer to the definition of employer, as provided in section 2(f) of the Payment of the Gratuity Act. Even for that purpose, two different controlling/ recruiting authorities in two different companies can be termed as two different employers. Legally, a company is an artificial person, who is deemed to be your employer. So, two different persons (companies) cannot be your employer simultaneously.

From India, Delhi
Dear All,
An Employee worked in two companies and the employer (the director or one of the partners or the proprietor) is one and the same, and on the condition that the services of the said employee is undisturbed and transferred to the second company means, even the F&F is cleared other than gratuity means, the said employee is entitled for gratuity, on the condition that the second company of the promoter is an expansion of business and for administrative reasons only the employee in question was given a transfer.

From India, Chennai
If the same employer and different companies, once settlement received and joined in his other entity it will be considered as new employment. If the same employer gives a transfer letter, stating that the previous entity's service would be carry forward, then the eligibility speaks.
From India, Chennai
The new discussion of gratuity is that the one principal employer engages one (same) employee for two years under one contractor and for another three years under another contractor.
At the end of the 5th year both the contractors are not in an obligation to deliver his gratuity saying that his tenure in their each one's contract was less than 5 years.
In this context, it is the duty of the principal employer, since the employee has worked for the same principal employer for the entire 5 years of tenure, to disburse the gratuity.
Anyone, with different opinion share please.

From India, Chennai
Some of the PEs (Principal Employer) are getting escape from the context of continuing service clause of gratuity act, by engaing contract labours for a period of one year or less than two years at a single contract and give them a reasonable break in service for a period of 30 days to 120 days and again engage (not terming as appointment or employment or job or duty in the order of engagement) them by another contractor for a subsequent period of two years and so on....

Thus the graduates and engineering graduates and diploma holders are not able to settle down with permanenacy in employment.

We have to discuss this subject elaborately and find a solution.

My view is the most of the CTC structure is given with gratuity structure of 4.81% of CTC and the same is not paid at the end of each year, or at the end of tenure of employment, when it occurs before the completion of five years of service, as per gratuity act. If so, why the gratuity structure is included in annual CTC, as most of the employees are changing their employment well before they complete 5 years. If the PEs are more particular about their, funds and financial problem, better they can come under group gratuity scheme , by depositing the gratuity payable by way of annual premium and link the gratuity with life insurance companies. In spite of that, the PEs are very particular to find by-pass way to escape from the gratuity payment. Why this trend among PEs. If only the payment of gratuity is the only way to regularise their financial constraint. please discuss and find a solution amicabily.

From India, Chennai
Dear Sir(s), This is a complex problem, which has cript up due to MBA(HR) + C.A. attached with big group of companies under a single powerful/popular /influential/experienced industrilist like, Ambani,Tata,etc.
OFCOURSE such industrilist(s) promote new and new companies under their banner but bifurcate all unit(s) and controlling unit does not allow to club unit(s) inter-se for financial &/or general admin. purpose. Thus they keep their group intect but with independent units.
Until and unless, situation is legally addressed and ambit of terminal benefits are spread to the extent of inter-se transfer etc. the employee will be deprived of benefits like gratuity and other benefits . However min.of law/min of hr/chemeber of comm jointly can look for a amicable solution(s). But it needs empathy/sympathy and concern with employee which is presently lacking . g.p.agarwal,lucknow 8009458901

From India, undefined
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