One of our employee joined in 2011, served for almost two years and was terminated on disciplinary grounds. He challenged termination in the court and was reinstated with back wages, he was reinstated in 2017 without payment of back wages.
Payment of back wages was challenged in High Court and High Court stayed the labour court order of back wages.
This employee is being terminated on disciplinary grounds based on Domestic Enquiry and management decision.
Question -
1. Is he entitled for gratuity since 2011 or not since back wages payment stayed by High Court.
8th August 2019 From India, Indore
Reinstatement can be with or without back wages but once he is reinstated it should be construed that he continued to be in service without any break in service. As such he is eligible for gratuity from the date of joining. When you terminate the employee now, on what charges are you terminating is an important question that may arise. If the charges are moral turpitude or riotous behaviour you can forfeit the gratuity following section 4(6) of the Payment of Gratuity Act. On charges other than that mentioned in section 4(6) (a) or (b) you cannot forfeit gratuity.
8th August 2019 From India, Kannur
When an employee is reinstated he is entitled for all benefits and for dis entitlement of gratuity you are supposed to give notice to the employee stating the grounds on which you are going to disallow the gratuity. Charges proved against moral turpitude or financial damages to employer you can disallow gratuity.
8th August 2019 From India, Bangalore
I am in complete agreement with Mr.Madhu.
The issue raised is, as I am able to understand, not the forfeiture of gratuity but only whether the period of absence during say 2013 to 2017 due to the operation of the punishment of dismissal that was set aside later should be included in the qualifying service for gratuity or not.
When the award mentions " reinstatement with back wages", it would automatically imply "reinstatement with back wages and continuity of service with all attendant benefits". In the absence of the grounds of challenge against "the payment of back wages" part of the award that is not made available for perusal, one has to presume that the Labor Court might have set aside the punishment of dismissal in its entirety and hence the direction to reinstate with back wages. Otherwise the Court would have modified the punishment as excessive and would have ordered no back wages or lesser rate of back wages under the powers vested in the Court u/s 11-A of the I.D Act,1947.
Coming to the dismissal proposed at present on some other grounds of misconduct, the poster needs to explain why the management raises the issue of exclusion of the individual's service from 2011 to 2017 based on its pending appeal against the back wages part of the award. If one dwells deep into the sweeping meaning of Sec.2-A of the P.G Act,1972, one cannot escape the conclusion that the absence of the incumbent say from 2013 to 2017 due to the punishment of dismissal which was subsequently set aside by the Labor Court has to be notionally treated as continuous service only. Even if the appeal of the management regarding the issue of back wages succeeds, in my opinion, it can not alter the factum of continuity of service of the individual.
8th August 2019 From India, Salem
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