Thread Started by #thakursumitmba

I want to know that if gratuity is a part of CTC then gratuity is payable at the time of exit or not.
service period 4 yrs. Please sir give the reply as soon as possible.
24th August 2018 From India, Dehra Dun
Answer in short is NO.
Gratuity is payable on completion of 5 continuous years of service.
Inclusion in CTC does not mean that you will get gratuity without completing minimum period as stipulated by law.
24th August 2018 From India, Pune
4years 240 days they are eligible for the gratuity
24th August 2018 From India, Ahmedabad
Hi
Just because some employer includes the term Gratuity in the CTC does not change anything as far as the applicability of the Payment of Gratuity Act. It will and shall remain the same with 5 years being the criteria in an employment continuously, subject however to the technical qualification of the last year if anyone resigns/retires/superannuates in the fifth year, in which case 240 working days comes into play.
Thanks and Regards
24th August 2018 From India, Hyderabad
When an employer includes Gratuity in CTC , he does not pay out the gratuity portion in the take home salary.In case he includes it then it is his problem as he is liable to pay Gratuity after due service .
Col.Suresh Rathi
24th August 2018 From India, Delhi
Statutory Gratuity is part of CTC and cost is allocated towards employee costs which is payable upon completion of 4 years 240 days. If your salary is being deducted towards gratuity then you can claim the same irrespective of your CTC.
27th August 2018 From India, Mumbai
Gratuity is a statutory right of employee whoever completes 5 years in the same organization, and is a terminal benefit. The cost is to be born by employer and not employee. Gratuity can not be a part of CTC. ...
27th August 2018 From India, New Delhi
All costs related to employee remains part of CTC and therefore, Statutory Gratuity is part of CTC, i.e. cost to company @ 4.81%. Gratuity along with other terminal benefits are also part of the total employee cost to the company. A Trust is created for Gratuity payments with LIC and monthly premiums are paid toward this fund and the cost is charged to the employee account.
27th August 2018 From India, Mumbai
"A Trust is created for Gratuity payments with LIC and monthly premiums are paid toward this fund and the cost is charged to the employee account.""
No part of expenditure on account of gratuity is payable by employee.
Having a gratuity fund with LIC is the company's look out for timely payment of gratuity as and when employees exit and are authorised gratuity.
27th August 2018 From India, Pune
CTC is the projected estimate of all the expenses to be incurred by the employer per employee in a year. Just because it is mentioned in the offer letter or appointment order, it doesn't mean that all the benefits mentioned therein should be paid to the employee who leaves the organization either on his own or otherwise unless he fulfills the conditions for their payment. Particularly, gratuity being a statutory benefit, its payment is strictly subject to the provisions of the Payment of Gratuity Act, 1972 which is a complete Code in itself on the subject-matter of gratuity as invariably suggested by all the learned members above.
28th August 2018 From India, Salem
Answer is Yes if he complete his gratuity eligibility period before leaving the job otherwise he will be not able to get gratuity.
Read this >>> <a href="https://www.sabkuchonline.in/2018/02/know-all-about-gratuity-hindi-gratuity.html">What is Gratuity Eligibility and other rules?</a>
Thanks
29th August 2018 From India, Delhi
Inclusion of Gratuity amount in CTC to employee's salary is not correct as per my knowledge
Please note that, the payment of gratuity is additional expenditure to employer as a part of social security benefit t employee.
However, employer has to keep provision towards payment of gratuity for having completing continuous service rendered by an employee.
But if an employee dies while working, the completion of five years will not come to picture and the payment has to be made to the nominee as per prevision.
To make more attractive package to employees, we people(HR) will create / add this amount in CTC is bad practice.
Someone has suggested to cover this risk under LIC is best option.
31st August 2018 From India, Bengaluru
Every penny spent on an employee is accounted for CTC. Gratuity is also a part of CTC. As sogemar mentioned, a trust is formed for Gratuity with a Bank and the gratuity share of the employee is deposited.
Once the employee completes 5 years or 4 years and 240 days whichever is earlier in case an employee resigns, gratuity will be paid on last drawn basic @4.81% along with full and final settlement.
If gratuity is a part of CTC and an employee leave with 4 years, company is not liable to pay Gratuity.
Regards,
Shweta Gehlot
31st August 2018 From India, Delhi
#Anonymous
Nothing wrong in making gratuity as part of CTC to my knowledge and need not blame HR. What is CTC, it states what is the total expenditure for an organisation on an organisation which includes all benefits statutory and non statutory that are payable to him. A benefit like LTA will be paid on termination or resignation as part of settlement, while benefits like gratuity are subject to statutory provisions. It is basically to understand by both sides what is an employees cost to organisation.
1st September 2018 From India, Hyderabad
yes you are eligible for gratuity if your grauity a part of ctc
5th September 2018 From India, undefined
Dear All,
If any component in salary is part of CTC then it should be payable to employees at time ending FY or exit of employees
there is no clause to retain this amount even statutory condition is not full fill but mostly company is agree to pay.
Regards
Dhananjoy
8th September 2018 From India
Applicability of Gratuity as per Payment of Gratuity Act and is mandatory to every employer to pay leaving employees, who completed five years of service.
If Gratuity is included in CTC or excluded. doesn't matter.
If employee balance earned leave shall be considered to complete five years of service.
Employer can hold Gratuity payment in certain case.
Employee is dismissed through services due to misconduct as per law
8th September 2018 From India, Satara
Gratuity is payable on completion of 5 continuous years of service.
Inclusion in CTC does not mean that you will get gratuity without completing a minimum period as stipulated by law.
8th September 2018 From India, Bhalta
Gratuity is payable on completion of 5 continuous years of service.
Inclusion in CTC does not mean that you will get gratuity without completing minimum period as stipulated by law.
Calculation : Basic Salary*15/26 * more then 4 Yrs 240 Working Days... He/ she will be applicable for the Gratuity...
9th September 2018 From India, Bangalore
I think the employers are using CTC just to make it attractive to their prospective employees. He need not mention CTC because when he does so as annual package without specifying any other condition such as per Payment of Gratuity Act etc., he binds himself in a specific contract with such an employee who may always want to get his package as per terms of his employment conditions and the employer may not be in a position to wriggle out of this contract even when the employee may not have completed the requisite statutory period as enumerated in the PGA. Who knows, the Controlling Authority under the PGA may view the matter eye to eye with the applicant.

I suggest that the employers should refrain from writing CTC and should clearly specify in the appointment letter to his employee, the amount of salary/wages he would be paid + the statutory benefits like PF, ESI, Bonus, Gratuity etc. Even if the employer does not mention CTC, the employee understands it and gets it in accordance with the applicable law.

Give it a thought.

Best wishes and regards
13th September 2018 From India, Chandigarh
Hi

If it is part of the CTC, Yes its payable, even though you haven't completed 4 years and 240 days

Thanks

SMJ
14th September 2018 From India, Faridabad
Hello everyone.

Indeed, writing the word CTC is unnecessarily giving a handle to the Controlling Authority, Appellate Authority of Higher Courts to construe its meaning against the employer. It really does not bring any benefit to him. May be he may have to face hard time to give justifications at different forums for such an unnecessary word. Hence, better avoid than feel sorry later.

Regards
14th September 2018 From India, Chandigarh
If it is part of the CTC and clearly not mentioned in appointment letter or in terms and conditions of employment, then Yes its payable, even though you haven't completed 4 years and 240 days

Regards,

V K SHARMA
14th September 2018 From India, Delhi
When you see at CTC, the particulars of salary shows in the break-up becomes an employee benefits. Therefore, its a liability by an employer to pay the employee benefits which includes in the CTC.
No employee would like to leave his/her liberties assured the time of hire and entitled avail complete facilities were offered.
Dear Seniors, correct me if I am wrong.

Rgds,
Anand
15th September 2018 From India, Bangalore
All the Answers related to Gratuity Act.
17th September 2018 From India, Kolhapur

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