Why Do Companies Deduct Gratuity in CTC and Can You Get It Back If You Leave Early?

Dear All,

Why do some companies show Gratuity deduction in the CTC? Can an employee who resigns from the company before completing five years of service get the money back? Please provide me with some valuable insights on the same.

Regards,
alenshiva

An employee who leaves before completing 5 years of service is not eligible for gratuity. Moreover, gratuity is a payment made solely by the employer and not considered a 'contribution' like provident fund or ESI. The practice of labeling gratuity as Cost to Company (CTC) and deducting it from the first salary is illegal and should be discouraged. I hold a distinct perspective on the CTC concept, which is elaborated in my post "CTC Vs BTC." You can access it through the following link: <link outdated-removed>

Regards,
Madhu.T.K

Dear All,

In case there is a gratuity deduction from the very first day for an employee, can the accumulation be paid under a different head in the F&F settlement when the employee is leaving the company before four years and eight months/five years? Requesting some views/clarity on the topic.

Regards,
Moumita