Is Gratuity Payable for 4 Years and 7 Months of Service? Seeking Clarification

Dear All,

I want to know whether gratuity is payable to an employee who has worked for 4 years and 7 months in the company. Please clarify my query by replying to my question.

Regards,
Pramod Patil

Hi Pramod,

According to the Gratuity Act, an employee should complete 5 years of service. Therefore, based on your question, gratuity is not payable to those who have completed 4 years and 7 months.

Thanks,
Anita

Dear Mr. Patil,

As per the amendment in the Gratuity Act, gratuity, in this case, is not payable. If an employee has worked for a minimum period of 4 years and 240 days, he would have been eligible for gratuity. On completion of the 5th year, if he works for another 6 months, he would become eligible for the full benefit of 6 years.

Regards, AS
Email: avinash09babbi@gmail.com

Dear Pramod Patil,

As per the Gratuity Act, the eligibility criteria state that gratuity shall be payable to an employee upon the termination of his employment after he has rendered continuous service for not less than 5 years. Therefore, for an employee to become entitled to the payment of gratuity, he must have rendered continuous service of at least 5 years. The completion of continuous service of 5 years is not necessary where the termination of the employment of an employee is due to his death or disablement. However, if an employee has completed 4 years and 240 days of continuous service in the 5th year, he is eligible for the gratuity.

Regards,
Vasu Gollapalli
9959654284

Dear Mr. Patil,

The minimum qualification for the payment of gratuity is five years of continuous service with an organization. Hence, I am afraid, in this case, the said employee is not eligible for gratuity.

Regards,
RJ Nair

Avinash and Vasu,

Can you please clarify how these 240 days are calculated? Are they counted only for the working days or for 240 days in a year?

Hi,

Gratuity is not payable for 4 years and 7 months of service in general as 5 years of service are not completed. However, if an employee dies or is dismissed due to total disablement, gratuity is payable for 4 years and 7 months of service.

This is very good and the actual eligibility of Gratuity. And if an employee is terminated by the company after 4 years and 6 months, he is also eligible for Gratuity.

Ashok

Please refer to the case of Labour Officer vs. Mettur Bearsell, Madras High Court 1998. The judgment clearly states that if someone has completed 240 days in the 5th year and remains in continuous service, they must be paid gratuity as per the computation of 5 years.

Dear Patil,

Just relax. The said employee is not eligible for gratuity. An employee is eligible for gratuity only when he completes 4 years and 240 days (240 days means days for which salary paid). Hence, in your case, you need not pay. Feel free to call or contact on any topic.

Regards,
A. Elangovan

Dear,

It will be payable because after 6 months, it will be considered 1 year, and after 5 years of service, gratuity becomes payable. Kindly refer to the Gratuity Act for more details.

Joginder Singh

Gratuity is payable for an employee if they have worked for 4 years and 8 months (240 days). Normally, in staff cadre, an employee is paid full salary inclusive of leave; hence, they are eligible for gratuity after working for 4 years and 8 months.

Regards,
Kishore

Hi all,

I understand that the Gratuity Act has been amended, and anyone who has worked for a minimum of 3 years is eligible. I am not sure about it myself... Can anybody confirm the same?

Regards,
Munish

Hi all,

Can anyone clarify whether gratuity is applicable to which category of employees and for what type of service? I mean, is it only for government employees, employees of limited companies (private jobs), or employees of private limited companies (private jobs)?