Entitlement can only be by request from the Employee which should lead to Grant of Gratuity by the Employer.If Employer refuses then a dispute arises for which the remedy lies with the Authority nominated in the Payment of Gratuity Act.


Firstly, it depends on the no. of employees your company has, it is more than 10 employees that means your company is liable to pay gratuity to its employees. Gratuity is payable on last drawn basic / basic +DA salary (if DA is a component in your salary structure).
It dosent matter if it is mentioned in your Appointment letter or not, neither does it make a difference if it is not mentioned in the HR manual.
If your company has more than 10 employees, it is applicable by law and the company is liable to pay.
Shweta Gehlot

From India, Delhi

You have not given full facts of your case. With the limited fact, - 1. if your organisation is covered under this Act than you will be paid Gratuity as per Act after completion of 5 years that is 6th Dec.
2. If your employer is progressive Employer and wants to create a Good Brand Image in the employment market than he may consider your case as a gesture of goodwill.
V K Sharma

From India, Delhi
In this discussion only discussed is how much days one should work for eligibility of Gratuity. Other aspect like how the component
of gratuity is worked out is not at all mentioned except one member who states that " Gratuity is payable on last drawn basic / basic +DA salary (if DA is a component in your salary structure).
More clarification is required on Gratuity calculation which says ...`basic/basic +DA salary (if DA is a component of in your salary structure)` As I understand there are two methods of salary structure as adopted by various employers : (i) basic + DA + other component (ii) All inclusive Consolidated Salary which does not give any break-up of the salary.
If the second method is adopted by the employers, then full salary has to be taken for calculation of Gratuity. Is it correct?
More knowledgeable person on the subject may please explain this?

From India, Thane

Learned friends have contributed much on this and I wish to add that nowadays Gratuity is a hidden compensation variable, which is accounted as an employee total cost towards HR budgeting. However, if gratuity deducted is mentioned in the appointment letter then it is imperative that the company has deducted the employee salary as gratuity and therefore payable irrespective if the employee has completed 5 years of continuous service or not?
After a lot of claims by employees for gratuity with the gratuity commissioner, the employers have learnt a hard lesson and stopped mentioning the gratuity in the appointment letter thereby avoiding payment altogether, and only payable if the employee has completed 5 years of service to comply with the statutory requirement. So these conditions need to be kept in mind which condition leads to payment of gratuity.

From India, Mumbai

Further, Gratuity is deducted at the rate of 4.81% of the basic and kept aside in a Trust corpus with LIC for payout at the time of employee separation.
From India, Mumbai

Dear Anishkane,
Gratuity will be paid out irrespective of the terms in your appointment letter as long as you complete 5 continuous service years with your organisation.
Click on the "+" sign for more helpful answers like these
Sairam Bandi

From India, Bengaluru
I have worked for a Limited pharm for long 21years.My innitial appointment was markteting executive by a branch manager.After 7yrs of Service Manager retired and MD given another appointment letter.Now problem is company is not accounting my first 7 yrs gratuity. What is the reason?
From India

You will need to discuss that with the company. None of us here work for your company so we are not in a position to answer this question.
From Australia, Melbourne

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