correct calculation of Gratuidy calculation - CiteHR
Umakanthan53
Labour Law & Hr Consultant
Pujarirvv
Financial Accounting

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R sirs.... kindly guide me to calculate correct gratuidy amount. Date of joining in proprietory firm is Nov. 93.
Proprietory firm converted in partnership in 1996 & again p ship to pvt. Ltd. Co. In 2006. I was left in June 2008 n rejoined in Nov. 2009. No. Gratuity waa paid by the eatablishment. Now i fimally left in 30 sept. 2017. Co. Management wish to calculate gratuity from 2009 to 2017 on basis of basic of sept. 17 Is it correct ?
No provision made in audited balance sheet. Can i claim from 1993 ezcluding break period ? For break perood what is the base of calculation ? Can i get any legal support as no appointment letter given ?

Dear Pujari,
The conversion of the same establishment into different forms or change in its constitution from time to time is only a cosmetic change in respect its legal liability for payment of gratuity to its employees under the Payment of Gratuity Act,1972. What is important is the continuity of employer-employee relationship or the continuity of the service of the employee under the establishment.
In your case, your initial spell of continuous service from 1993 to 2008 came to an end by your leaving of the establishment in 2008. You were eligible for gratuity of roughly about 15 years of continuous service subject to the applicability of the Act to the establishment. In such a situation, the employer ought to have paid the gratuity within 30 days from the date of your termination or should have deposited the amount as per his calculation with the Controlling Authority u/s 7(4)(a) and you ought to have made an application to the Authority immediately u/s 7(4)(b) of the Act respectively. Your post is silent both as to why gratuity was not paid to you and why you did not make any application for gratuity forthwith. Therefore, you can not club the previous spell of your service with the present spell commencing from 2009 after the break in 2008 and claim gratuity for the entire period from 2003 to 2017. The claim for the period of 2003 to 2008 is certainly barred by limitation and one can not be sure whether such a long and unexplained delay would be condoned by the Authority now.
As regards the second spell of 2009 to 2017, you are eligible to claim gratuity based on the last drawn salary ( only basic+D.A ) i.e payable in the month of September,2017.
The absence of provision for gratuity in the Balance Sheet of the Company can not absolve the employer of his liability to pay gratuity under the Act.
If you are desirous of making a claim for the first spell of your service, the last drawn salary payable for the month of June,2008 only has to be taken into account.
In the absence of issue of appointment orders either in 2003 or in 2009 or on both occasions, if it is disputed by the other side, you have to prove the factum of your continuous employment by means of any other documentary evidence such as service card, wages slip, bank pass book in your possession or calling for attendance register, wages register etc in the possession of the employer.

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