Madhu.T.K
Industrial Relations And Labour Laws
Valbooj
Manager
Keerthipranav
Executive - Payroll
U.K.Singh
Sr. Personnel Officer
C K Das
Managing Director
+2 Others

Hi
Any one out there can answer this question?
Is a Managing Director of a private limited company eligible for Gratuity.
He has worked for 10 years and is a shareholder. He has no appointment letter and provision for gratuity is not given in the previous years' balance sheets.
TQ
CK
26th January 2008 From India, Thrissur
IF refer the Sec 2 of the Gratuity Act, you can observe that Managing Director is eligible. More over the employee who is on the rolls of the company and payroll, eligible for gratuity as applicable.
27th January 2008 From India, Gurgaon
according to emploment act..a person holding the highest position without appointment letter is eligible for gratuity.
27th January 2008 From India, Hyderabad
He is elligible for gratuity provided he is working in the company in the capacity of employee and is not the owner of the Company.
28th January 2008 From India, Calcutta
The MD of an establishment is eligible for Gratuity provided he had drawn SALARY from the establishment in which he is share holder. Being an employee he should have signed in the (daily)Muster roll and (monthly)salary Register of the establishment. Other tests like contribution to EPF, naming in monthly returns etc shall also be made so as to decide whether he is an 'employee' eligible to claim gratuity. If he satisfies these tests, then certainly he is eligible for gratuity and he will get gratuity subject to a maximum of Rs 3.5 lakhs.
Regards,
Madhu.T.K
28th January 2008 From India, Kannur
Mr.Madhu T.K.
I have read the referred section [Sec 2 (f)(iii)]. But reads about the meaning for Employer. Whereas, section 2 (e) tells about the employee. Where I need a clarification, whether the "such person is employed in a managerial or administrative capacity" refers to Director/Managing Director or till the level of CEO only.
My question is, any specification in the Gratuity Act for payment of gratuity to its Director or Managing Director [Whether if he holds any share in that company or not]? Is a Director eligible to draw the Gratuity?
Regards
ANBARASU THAMBIRAN
7th June 2011 From India, Madras
The provisions relating to approved Gratuity Funds are se tout in Part 'C' of the Fourth Schedule of the Income-Tax Act, 1961 and part XIV of the Income-tax rules, 1962.
As per Rule 102 of the same - Admission of director to a fund-restricted to those owing not more than 5% of voting rights
22nd January 2015 From India, Mumbai
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