An employee in PSU of HP Govt. is going to retire on attaining the age of superannuation after rendering 5 years service on contract basis and 3.5 yrs service on regular basis. Is he eligible for gratuity?
From India, Madurai
Labour Law & Hr Consultant
Seasoned Ir Professional
Sr. Executive-hr


In the first place, an employee of a PSU cannot be considered as a Government employee just because the PSU is wholly owned by the State or Central Government. Therefore, both the employee and the PSU are governed by the provisions of the PG Act,1972 only. Whether the previous service rendered by the employee in the same establishment as a contract employee has to be clubbed with the latter service rendered by him on regular basis or not depends upon the terms and conditions of his appointment. Anyway, incase of denial, he can file a claim before the Controlling Authority under the Act after his formal retirement on attaining the age of superannuation.
From India, Salem
Worked on yearly contract signing an agreement of service for the period one year every time. Signed so far 10 agreements without a loss of a single day and hence worked continuously for 10 years. Do I can be treated as "Employee" for Gratuity and signing the contract every year will deprive me from the Gratuity? The HR is denying me the Gratuity stating that since I have signed the contract every year I am not eligible for Gratuity.

Every year a new agreement was signed with a change in remuneration / Honorarium only keeping all the terms and conditions same. There was no mention on payment of gratuity in any of the agreement. The agreement can be terminated by giving one month notice by either party.It also says that "The said contract stands terminated on its expiry unless renewed".I was following the attendance ,rules and regulations of the company with leave policy.
i have approached the employer and the Controlling Authority under the Payment of Gratuity Act, 1972 by filing the application in form "I" & "N" Respectively.

Please advice sir.
thanks in advance .............

From India, Chennai

In my opinion you are eligible for gratuity. You were employee under a fixed term contract arrangement. You may refer Goodyear India Limited vs. K.G. Devessar, (1985 4 SCC 45) and also please o through the attachment which is pertaining to one PSU.
From India, Kannur

Attached Files (Download Requires Membership)
File Type: pdf Gratuity to FTC.PDF (227.7 KB, 5 views)



I also do agree with Mr.Madhu, You are eligible for gratuity, My previous organisation was also employing people under FTC, which is renewed every year and they were all eligible for Gratuity.

I was working with an MNC registered under S&E.

From India, Mettupalayam

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