Gratuity pay for habitual absenteeism - 15 years service and he is not regular for the last one year - CiteHR
Umakanthan53
Labour Law & Hr Consultant
Vmlakshminarayanan
Sr.manager - Hr&admin

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Dear Folks, One of our staff got 15 years service and he is not regular for the last one year. His present days is avg 15 days during the 15th year of his service.
He is resigned now , while calculating gratuity how to take last month salary ? since he is not worked for whole working days.
Regards

Hi,
Please refer the following
Five years continuous service: An employee in order to be eligible to claim gratuity, should have worked with a particular employer for at least five years
Section 2A of the Gratuity Act, states that ‘continuous period’ shall also include the following:
If in case employee is not in continuous service of one year, he/she shall be deemed to be in continuous service of one year if- he/she has, in immediately preceding twelve calendar months, worked under the employer for not less than:
190 Days (in case of employee employed in mines below ground)
190 Days (in case if employee employed in an establishment which works for less than six days in a week)
240 Days ( in any other case)
If in case employee is not in continuous service of six months, he/she shall be deemed to be in continuous service of six months if- he/she has, immediately preceding six calendar months, worked under the employer for not less than:
95 Days (in case of employee employed in mines below ground)
95 Days (in case if employee employed in an establishment which works for less than six days in a week)
120 Days ( in any other case)
If an employee of seasonal establishment is not in continuous service of twelve or six months, he/she shall be deemed to be in continuous service of twelve or six months; if he/she actually worked for not less than seventy five percent of the number of days on which the establishment was in operation during such period.
By continuous service for the purpose of gratuity it is meant uninterrupted service which may be interrupted due to accident, sickness, absence for duty without any leave, leave, lay-off, lock-out, strike or cessation of work (due to not any fault of the employee) are considered as continuous service.
Following days shall also be included while calculating the actual days of an employee has worked for:
If an employee has been laid-off under an agreement
If an employee has been on leave with full wages
If an employee has been absent on his duty due to temporary disablement caused by an accident arising out of and in the course of his employment
Maternity leave for female employee, not more than twelve weeks

Dear Mohandas,
I think your doubts about the last drawn salary and including the last year's service of the employee for the purpose of computing the gratuity of the employee who turned out to be irregular in attendance during the fifteenth year of his service due to resignation arise because of the following two reasons - (a) his last drawn actual salary during the last month of his service was less than a full month's salary due to his absence and (b) his attendance was not regular in the 15th year but just 15 days per month on average.
I also think that by this time you would have carefully gone through the elaborate answer given by our learned friend V.M.L about the calculation of continuous service with reference to sec.2-A of the PG Act,1972.
Anyhow, I would like to add the following to make the understanding of the situation explained by you easier.
(i) If you read the explanation to the proviso of subsection (2) of section 4 of the Act, you will understand that it is not the actual last drawn wages but the rate of last-drawn wages that has to be taken into account for the calculation of gratuity.
(ii) The interruption of unauthorised absence from duty without leave should have been treated as break in service by the employer under the standing orders or service regulations applicable. If it is not done, it has to be included for the purpose of continuous service as per section 2-A.

The employee is eligible for gratuity as has been completed 5 years of service. While calculating, pay only for the period(year) has conteneous service. The calculation to be done on Basic wages that remained at last working day of the employee.
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