Labour Law & Hr Consultant
Personnel And Admin Officer

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Respected & Dear All, Our one of employee has completed 5 years of service & left right now. We prepared his gratuity sheet & submitted to accounts department.
our accounts manager has a query, at the time of joining of the said employee the strength of 10 person does not full fill, then how gratuity is applicable to him?
Right now we have more than 150 manpower. Please guide on above scenario.

Dear Mohan,
Statutory gratuity is a one time cumulative benefit payable on the termination of employment based on the length of service computed backwards from the very date of termination. Once the PG Act, 1972 becomes applicable to any establishment u/s 1(3)(b) or (c) by virtue of the no. of employees on a particular date, the Act would be applicable to all the employees with retrospective effect notwithstanding the fact that the number of employees remaining less than the threshold either in the past or in future. This is the quintessence of the enabling provision given under section 1(3-A). What is important is that the termination of employment of any employee should take place on the very date or afterwards the Act becomes applicable to the establishment.

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