Jeroo Chandiok
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Amith R Murthy
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Bhaveshmsw
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Parveen Kundlu
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Thread Started by #Bhaveshmsw

Dear all friends.
All are knon Gratuity Calculation, Basic+Da / 26* 15 * NO. OF YEAR.
here problem with no of year.
1. Employee experience year is 26 year 8 month 18 days what to do.
how many years i can take.
2. Employee experience year is 27 year 4 month 14 days what to do.
plz send a no of years for both query.
Thanks in advance.
9th May 2008 From India, Ahmadabad
Hi,
Employee experience year is 26 year 8 month 18 days what to do.
You can consider this as 27 Years
Employee experience year is 27 year 4 month 14 days what to do.
You can consider this as 27 Years.
Regds
Surender
9th May 2008 From United States, Salt Lake City
sorry surender.. but second ans. is wrong dear. if under 6 months duty is there then take previous year.
9th May 2008 From India, Ahmadabad
For eligibility of the Gratuity , an employee has to complete 5 years of service and after that, If the any employee worked for more than six month at the time of the settlement, take it as one year. and if an employee works for less than six months, it is to be ignored. Hence Surendar answer is correct ( where the experience is 27 years 4 months 14 days) then it is 27 years.
T.Mahendar Reddy
10th May 2008
Surender’s answer is correct in all respect. I agree with Mr. Reddy’s reply. rajkumar
12th May 2008 From India, Delhi
Hi Friends, What about the maximum limit? I think we have something like this when it comes to Gratuity amount. Let me know about this................ Regards Amith R.
12th May 2008 From India, Bangalore
Hellow Amit Murty,
The amount of gratuity payable shall be at the rate of 15 days wages based on the rate of wages last drawn (Basic -DA), for every completed year of service ( if the fraction of a year is below six months it is to be ignored and above six months will be treated as one year). The maximum amount of gratuity payable is Rs. 3,50,000/-.
13th May 2008 From India, Hyderabad
Hellow Amit Murty,
a small typographical error please. ignore the above reply.
The amount of gratuity payable shall be at the rate of 15 days wages based on the rate of wages last drawn (Basic + DA), for every completed year of service ( if the fraction of a year is below six months it is to be ignored and above six months will be treated as one year). The maximum amount of gratuity payable is Rs. 3,50,000/-.
13th May 2008 From India, Hyderabad
A comment.
Gratuity payable is not subject to any maximum limit under any law. For instance, if the calculation shows a gratuity payable of Rs. 5 lakhs, the employee is entitled to the full amount. However, only Rs. 3.5 lakhs will be considered as a tax free payment, and tax will have to be borne on the remaining Rs. 1.5 lakhs.
Jeroo
15th May 2008 From India, Mumbai
do an employee dismissed, eligible for gratuity benefits? if the dismissed employee has been sent the gratuity cheque, then what is the inference from this.can anyone clarify
15th May 2008 From India, Bangalore
What Mr Surender given is absoultely right for calculation to take the no of years in services is separated by six months of cirearita. Regards R Parthasarathy
15th May 2008 From India, Madras
Hi,All I dont know how to caliculate the gratuity which basic i can take . its last basic or first basic or evry year basic. pls help me out. byeeeeeeee
15th May 2008 From India, Hyderabad
Hi ALL,

In cases other than a government employee , gratuity is exempt on the following basis:


Any gratuity received under the Payment of Gratuity Act is exempt to the extent of the least of the following
*Rs 3,50,000
*15/26 x last drawn salary for every completed year of service or part of the year in excess of six months, or
*Gratuity actually received


Salary for this purpose means basic salary and dearness allowance.

Any other gratuity received by employee/legal heirs on retirement, termination of services, death, etc., is exempt to the extent of the least of the following:
*Rs 3,50,000
*Half month's salary (on the basis of last 10 months average) for each completed year of service (fraction to be ignored)
*Actual gratuity received


Salary for this purpose means basic salary, dearness allowance, if provided in terms of employment, and commission as a percentage of turnover achieved by the employee.
Where a person is covered by the Payment of Gratuity Act, the exemption is available only if he has rendered a continuous service for a period of five years, except where the cessation of employment is due to death or disablement of the employee.

Also according to the Income Tax Act 1961 If the company is covered under Payment of gratuity Act then the Days/Month Fraction is added as a next year. Hence the 240 days comes into contention when calculating the gratuity amount. Thus if the person has completed 240 days in the last year of employment then it must be counted as the next year, if less than 240 days in the last year of employment then it has to be the previous year. For eg: 6 yrs 241 days is 7 yrs and 6 yrs 200 days is 6 years.

Also the year is calculated from his joining date for eg: 1-5-1999 to 30-4-2000 would be a year.

Hope the above is sufficient msg or post in case of queries.

Regards,

AJ
16th May 2008 From India, Thana
Hi AJ,
I need a bit more clarification about the 240 days part in your post.
If I have completed 4 full years of service and have completed 240 days in the 5th year, after which I leave the organisation, I will be eligible for gratuity right?
Does this 240 days exclude or include weekly offs, paid leave and public offs?
Thankyou for your time in advance.
Emereen
16th May 2008 From India, Mumbai
Hi Friends, Yes Gratuity limit is for 3,50,000/-. But you can pay more as Ex-gratia. Sixth Central Pay Commission has requested Govt to increase this limit upto 10 lacs. Thanks
16th May 2008 From India, Vadodara
Hi emereen,

If you have completed 4 years and 240 days, you do become eligible for gratuity.

The 240 days includes weekly off's and goverment of public holidays since they are considered to be working days by the companies registered under the gratuities act.

The following are the terms and definitions of "continuous service"

"Continuous Service" means uninterrupted service and includes service which is interrupted by sickness, accident, leave, lay-off, strike or a lock-out or cessation of work not due to any fault of the employees concerned, whether such uninterrupted or interrupted service was rendered before or after the commencement of this Act.

Explanation I.- In the case of an employee who is not in uninterrupted service for one year, he shall be deemed to be in continuous service if he has been actually employed by an employer during the twelve months immediately preceding the year for not less than-
(i)
190 days, if employed below the ground in a mine, or
(ii)
240 days, in any other case, except when he is employed in seasonal establishment. Explanation II.- An employee of a seasonal establishment shall be deemed to be in continuous service if he has actually worked for not less than seventy-five per cent of the number of days on which the establishment was in operation during the year. [Section 2(d)].
(d)
"Controlling authority" means an authority appointed by an appropriate Government under section 3. [Section 2(d)].
(e)
"family", in relation to an employee, shall be deemed to consist of-
(i)
in the case of a male employee, himself, his wife, his children, whether married or unmarried, his dependant parents and the widow and children, of his predeceased son, if any,
(ii)
in the case of a female employee, herself, her husband, her children,
You can follow this link for further legal proceedings that have been undertaken by individuals.

Gratuity Act 2000 <link updated to site home> ( Search On Cite | Search On Google )

Hope the above was sufficient.

Regards,

AJ
16th May 2008 From India, Thana
Dear Seniors
i want to know what is the formality to register some company under gratuity act . when we can send some one form F.Is there any time limit or not. is there any return related to gratuity act
for yours kind response
paveen
23rd May 2008 From India, Chandigarh
Hi Friends,
I am agree with Mr.Surender's reply. Further, max limit of gratuity is INR 350,000/- however, if more than this amount also may be paid if employer agree, but IT will attract for amount above 350000/-
Deepak
26th May 2008 From India, Kolhapur
Hi emereen, Please arrange to follow the link, or please inform me which amendment are you looking for. I can forward it to you. Regards, AJ
26th May 2008 From India, Thana
Hi, I work for Max Newyork Life. Any queries with regards to employee benefits you can ping me. I handle the products such as Gratuity, Superannuation, PF EDLI and GTL. Regards Sowmya
27th November 2008 From India, Ahmadabad
Hi friends,
I am having some deficulties in interpretation of clause "Continuous service" & "apllicability of gratuity", suppose one of the employee has joinned on 01/11/2003 and resigned on 30/11/2008 means after 5 years of service, here I wish to draw your kind attention, what happen if the employees remained absent in this 5 years with some intervals, which causes non complition of one year continuous service[ every year he has not complited 240 days of actual working]. Should I pay him gratuity or he is not entitle for gratuity? even if he was on our muster roll for the period more than 5 years. please help me.
Kishor
28th November 2008 From India, Pune
Hi Sowmya,
Your Max Newyork Life is insurance company, so you might be know how to calculate the actuarial valuation. Please send me the method to calaculate the actuarial valuation.
Thanks & Regards
Kishor
28th November 2008 From India, Pune
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