Gratuity as part of CTC - if an employee leaves the organisation within a year? - CiteHR
Umakanthan53
Labour Law & Hr Consultant
Rkn61
Hr Manager
Kjsrawat
Officer- Bhr

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Dear All, Now a day, company makes salary Annexure in which gratuity as a part of CTC, now i want to know if an employee leaves the organisation within a year then he get gratuity amount or not? Kindly, help me out.
I think immense querries have arisen about this in this Platform and experts have already given their opinion.
For the purpose of clear projection of salary or CTC (Cost to Company) some companies often do this . Not only gratuity but employer's share on Provident Fund/ESI are also mentioned because these elements are costs from the employer's view, hence this is correct also.
But payment of Gratuity shall be made in accordance with provisions of Payment of Gratuity Act, where you have to put in the minimum stipulated service of 5 years.

As a follow-on to Rkn61's above reply, I would like to add that if the statement of CTC forms part of the offer letter, there is every possibility to advance an argument later by the employee if he exits any time within 5 years of continuous service that proportionate gratuity should be paid by the employer since it is mentioned in the offer construing thereby it is a better term of gratuity as per the contract of employment.
Therefore, my submission would be that a rider may be added that in the event of exit of employment, the payment of gratuity would be strictly subject to the provisions of the Payment of Gratuity Act, 1972.

Dear Mr Rawat,
Now a days companies are taking all salary heads in CTC part bcz ultimately this is cost to company.
As per rules, employees will get the benefits of all the Heads. In Case of any employee left the company in a year or before 4 years 241 days , he/she will not entitled for the Gratuity.
Regards
Himanshu Sharma

If Gratuity is included in FCTC, it is obligation to the employer for payment of gratuity even employee left before 5 years service.
The employee would get nothing on account of gratuity, what the case may be.
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