Gratuity Eligibility on completion of more than 5 years by Retainership Contract & then Regular Employment - CiteHR
Umakanthan53
Labour Law & Hr Consultant
Vmlakshminarayanan
Sr.manager - Hr&admin
+1 Other

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Dear HR Professionals,
One of our employee joined on 17.05.13 to 31.09.16 (3 Years 4 months & 17 days) with a consolidated salary without any P.F deduction . Only deduction was TDS & Professional Tax. Subsequently he has been absorbed on Regular category on 01.10.16 with P.F deduction and may continue till 31.07.19 i.e. 2 Years, 9 months, 30 days by which his total service period reached to 6 years 2 months & 16 days. Now he asked for the gratuity. Whether he is eligible for Gratuity? Awaiting your valuable advice.
Thanks & Regards.
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Hi Biju
The shift from contract to regular category should be considered as continuity of service and his request for gratuity should be considered.
The above employee joined at first on Retainership contract basis & then absorbed in Regular category
Since the spell on retainership contract is only a contract for service, it cannot be clubbed with the subsequent spell of contract of service i.e., regular appointment. Therefore, the individual cannot stake any claim for gratuity for the retainership period. If his regular service comes to an end by resignation or on account of any reason other than death or disability before the completion of 5 years of continuous service, he can not claim gratuity for that period also.
@Umakanthan53 - Sir, In the past I have worked for a India Private Ltd company - under two different entities (but one group) - one was on Retainership contract and other one on regular rolls. At the time of resignation from regular rolls have requested for continuity certificate and got gratuity clubbing both contract and regular service. I think employer can consider the request of employee in this case.
Dear Mr.Lakshminarayanan,
In fact, finding the mismatch between the title of the thread and its factual presentation, the original long response I made soon after your reply could not be uploaded and irrecoverably lost due to some computer glitch. Hence my subsequent brief reply. Coming to your comments, the gesture of your former employer is highly appreciable. In my work experience, I have come across many employers who had come forward willingly to provide for higher rate for calculation of gratuity in their service regulations. I had also seen advocates engaged on retainer basis in companies later becoming their regular employees for obvious reasons. But the career of a retainer is different from
that of a regular employee in terms of service conditions and benefits. However, as in your case, if the employer is willing, he can confer better employment benefits not with standing the terms of contrat by ignoring statutory restrictions, if any in appreciation of the individul's service. But, my answer is strictly based on the legal position of the services of a retainer. Otherwise, I have no hesitation in supporting your view point.
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