Industrial Relations And Labour Laws
Nagarkar Vinayak L
Hr And Employee Relations Consultant
Gratuity & Leave Encashment Trust Fund
Hr Freelancer
Shipra Agarwal
Personnel Officer
Consultant For Social Compliance, Factory
Abhishek Unni
Marketing Executive
+2 Others

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We have terminated on permanent employee, for Unauthorized absenteeism.
Since it's an dismissal after conducting proper domestic enquiry proceedings, is that employee eligible for Gratuity.

If the employee has put in five years of continuous service, he is eligible for Gratuity.
Gratuity can be forfeited only for such dismissal from service which are for moral turpitude or loss caused due to violent or riotous behaviour of the employee. This is provided under section 4(6)(b) of the Payment of Gratuity Act and unauthorised absence will not qualify for forfeiture of gratuity. Therefore, he should be paid gratuity if he had worked for five years or such period like 4 years and 240 days as interpreted by courts of law.
It is true that the employee is eligible for gratuity if he has served 5 years continuous service. In habitual absenteeism case, prior to dismissal, if the employee has served 5 years continuous service but he has not put 240 days in all 5 years. Under the circumstances is he eligible for gratuity for the years on which he has present 240 days ? Secondly, while calculating 240 days shall we consider the days on which the employee has received wages as stated in Sec. 25 B of ID Act?
240 days means 240 PAID days. It is not 240 physically present days. The days on which he was on leave with pay, paid holidays and paid weekly off days will be counted as days worked.
In any year if the employee had short of 240 days and for that absence, action was initiated or the a absence remains unapproved,that year will be considered as interrupted service and in such cases, no gratuity shall become payable. On the other hand, if no disciplinary action was taken for his absence and the LOP was approved one, then that year will be counted as uninterrupted service for deciding gratuity eligibility

If employee has complete five years although he/she is terminated except fraud case Then employee is eligible for gratuity.
as per the statutory the employee is eligible when he completes 5 yrs of service
Yes, he/she is eligible for gratuity if he/she has completed 5 years of service in the organization regardless of the absenteeism.
If you wish to know further about any other labour laws contact me @8356832404.

yes if the employee has completed service for 5 years.
To make it simple, Gratuity is payable as per law if the employee has completed 5 years of continuous service with organization. But there is also one thing to keep in mind that gratuity is a way of presenting gratitude towards the employee's service.
Also, it is to keep in mind, after all the en-queries has been done, regarding unauthorized absenteeism, one will have to pay gratuity if there was no major mis-conduct from the employee side.

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