Hi,
This is an interesting question, whether inclusion of gratuity in CTC would make an employer liable for payment, if an employee leaves the organisation before fulfilling the eligibility criteria under the payment of gratuity act.
I think this question needs an indepth study. In my view, if an employer has not specifically mentioned 'gratuity' as per payment of gratuity act, in the CTC, an employee can claim this as a simple contractual obligation. He may claim, that it is a part of his salary which he had negotiated and which was agreed upon at the time of his appointment. He, under the contractual obligation, has a right to leave the employment, or the contract can be terminated by the employer. In the circumstance, the employer cannot refuse to pay the gratuity amount even though he has not completed five year of service.
The position would change if the employer specifically mentions in the CTC, 'gratuity' as per payment of gratuity act.
I am open to correction.However, I feel, one can raise the above plea, and legally contest it
Cyril
Cyril
This is an interesting question, whether inclusion of gratuity in CTC would make an employer liable for payment, if an employee leaves the organisation before fulfilling the eligibility criteria under the payment of gratuity act.
I think this question needs an indepth study. In my view, if an employer has not specifically mentioned 'gratuity' as per payment of gratuity act, in the CTC, an employee can claim this as a simple contractual obligation. He may claim, that it is a part of his salary which he had negotiated and which was agreed upon at the time of his appointment. He, under the contractual obligation, has a right to leave the employment, or the contract can be terminated by the employer. In the circumstance, the employer cannot refuse to pay the gratuity amount even though he has not completed five year of service.
The position would change if the employer specifically mentions in the CTC, 'gratuity' as per payment of gratuity act.
I am open to correction.However, I feel, one can raise the above plea, and legally contest it
Cyril
Cyril