Is an Employee Earning 20,000 Eligible for Gratuity After 5 Years of Service?

Dear Sir,

Is an employee, drawing a gross salary of 20,000/-, eligible for gratuity after completing 5 years when he resigns from the job?

Dear member,

Why not? If the Payment of Gratuity Act, 1972 is applicable to the establishment where this employee is working, then he will be eligible to receive gratuity from his employer.

With Regards,

R.N. Khola

Dear Sir,

Does an employee drawing a gross salary of ₹20,000/- become eligible for gratuity after completing 5 years of service, upon resigning from the job?

Hi friends,

We know that gratuity is payable only after completion of 5 years. What if an employee leaves, say within 2-3 years, and demands that whatever money has been deducted from his monthly salary against this head should be paid to him? Or at least demands to know what happened to the money? Where does it get accounted for, and does he have the option to get it transferred to his new company?

Regards,

Well, at the time of joining when we hire a person, his CTC shows this amount. Yes, we don't include this amount in the gross salary, but his complete package does include this.

Dear All,

I just want to confirm if the employee/s dies before completing 5 years, then is he eligible for gratuity...? As per my knowledge, YES... but still want to confirm, is there any criteria or rule for the same.

Regards, Chanda Patel

Every employee becomes eligible for gratuity from the day of joining the organization. However, the benefit is extended to the employees who have completed five years of service with the organization. No deductions are made on account of Gratuity.

In the event of death, the employee is still eligible for gratuity. The eligibility will be calculated from the employee's joining the organization until the retirement age, regardless of how many days or years he has worked for the organization.

Dear Chanda,

Yes, after death, the completion of continuous service of 5 years is not necessary. Please go through section 4(1) of the Payment of Gratuity Act, 1972 for further clarification.

Regards,
Sanjay Gupta
9871018121

Some companies show gratuity in the CTC, but no amount will be deducted from employees' salary. This benefit will only be given if the employees complete at least 5 years of service.

Ensure there is a single line break between paragraphs.

Hi,

My company started in 2007 (Security Services). Are the employees who joined in 2007 entitled to gratuity after 5 years? Or should the company be registered under the Gratuity Act? What is the procedure?

Thanks

Hi,

If an employee works for 4 years and 10 months and stops working or is terminated from work, will he be eligible for gratuity? Or will he have to complete exactly 5 years of service?

Thanks,
Murugabadi

Dear Members,

There is no ceiling on the eligible salary for gratuity, and of course, there is a ceiling on the amount of gratuity payable. Almost all organizations include gratuity as a part of CTC (contingent notional cost), but deductions are not in accordance with the law. In some organizations, employees are encouraged to take away their gratuity on completion of each year of service, starting from the very first year. I would request seniors to kindly advise on the correctness of the same.

1) Gratuity is paid to all employees who have served the organization continuously for 5 years with unblemished service.

2) Salary does not play a role in determining an employee's eligibility.

3) Recently, the maximum gratuity amount has been increased to Rs. 10 lakhs, and the total amount is also exempted from tax.

4) Even if an employee passes away before completing 5 years of continuous service, their nominees will receive the gratuity payment.

Hi,

I have a similar question. I am working in a small company (Software Company) for the past 4 and a half years. Now, my employer says that there is no concept of Gratuity in this company. How can I determine if my company falls under the "Payment of Gratuity Act, 1972"?

Regards,
Kalyan

Dear Kalyan,

If ten or more than ten persons are employed in your establishment, then the Payment of Gratuity Act, 1972 is to be considered as applicable.

With Regards,
R.N. Khola

"Hi, I have a similar question. I am working in a small company (Software Company) for the past 4 and a half years. Now my employer says that there is no concept of Gratuity in this company. How do I know if my company comes under the "Payment of Gratuity Act, 1972"?

Regards,
Kalyan