Gratuity Eligibility: Can This Worker Claim Benefits for Years with Fewer Days Worked?

Dear All,

A worker in a private organization has worked above ground for 10 years:
- 1st year: 300 days
- 2nd year: 210 days
- 3rd year: 298 days
- 4th year: 129 days
- 5th year: 310 days
- 6th year: 110 days
- 7th year: 303 days
- 8th year: 160 days
- 9th year: 180 days
- 10th year: 276 days

Now, is he entitled to gratuity for the 2nd, 4th, 6th, 8th, and 9th years? Please enlighten me.

Thanks.

Thanks, Peter Miano, for responding. By the process of management, do you mean how records are maintained or something else? Please specify. What exact notes do you want on the process of management.

Dear Raja,

First, find out the suitable forum relating to your subject and then post your query on a new thread if a similar thread is not there.

Regards,
R N Khola

He will be entitled to the gratuity for the complete 10 years since he has not discontinued the work, i.e., he has been on the payroll for all 10 years.

For further queries, please contact.

Dear, yes, he is entitled to gratuity payment for all years since he was in continuous service as per sec. 2A. Your doubt pertains to the completion of 240 days in those years where he had worked less than that. For your clarification, it is clearly given in clause a sub-section 2 of sec. 2A, i.e., "if an employee during the period of twelve calendar months preceding the date with reference to which the calculation is to be made has actually worked under the employer for not less than 240 days, he shall be deemed to be in continuous service under the employer."

In your case, in the last year, he has worked for 240 days; when you have to take the reference for the calculation to be made for his/her gratuity payment.

Common Confusions Regarding Gratuity Eligibility

Generally, there are two things people confuse:

1. Eligibility of Five years - "If an employee has worked for five years in a company, then to ascertain his eligibility, if he has completed 240 days in the fifth year, he will be deemed eligible for gratuity payment."

Secondly, if an employee worked for, let's say, 7 years, he is also eligible, but in the 7th year, he has worked for only 121 days. In this case, he will be eligible for 7 years of gratuity (Read Sec. 2A sub-sec. (2) clause (b) along with Sec. 4 sub-sec. 2) that clearly mentions every completed year of service or any part in excess of six months, and six months means 120 days in your case.

Lastly, please clearly differentiate between completed years of service (for calculation purposes) and continuous years of service (to ascertain the eligibility).

Hope the above will suffice for your query. Let me know for any doubts on it.

Thanks,

Regards

Dear Mr. Arif Khan & All,

Thank you for your valuable input. Mr. Arif Khan, please correct me if I am wrong, but what I understand from your input is that for an employee who has worked above ground for more than five years with a single employer (for any number of total years including the first 5 years, be it 6, 7, 9, 12, 17 years, or any other figure), for such an employee to receive gratuity for all the years worked, only the number of days worked in the last year of service should be 240 days or more, or the last six months of service should be 120 days or more. This day count includes all days of sickness, accident, leave, absence from duty without leave, etc., regardless of the number of days per year worked in all the years preceding the last year of service, even if the yearly day count was less than 240 per year in all the years before the last year of service.

Following this logic, only the total days of service in the last year or last six months determine the inclusion of all previous years in the gratuity calculation for an employee.

By the same logic, I understand (though I may be mistaken) that if a dedicated employee who has worked for more than 5 years with a day count of more than 240 per year cannot complete 120 days in the last six months due to some issue, they may not be eligible for gratuity for all the previous years as well. I have reviewed Sec. 2A subsec. (2) clause (b) along with Sec. 4 subsec. 2, and my interpretation aligns with the understanding above. Please correct me if my interpretation is incorrect.

Regards,
Raja.