Gratuity Eligibility and Calculation

Hi All,
As per gratuity act, if an employee completes minimum 5 years of continue service he is eligible for gratuity. [please correct me if wrong]
My question is if an employees completes 4.6 months of continue service, whether he is eligible for gratuity or not. please guide me urgent.
Regards,
Kanaka

hi kanaka,
going by wat i know n remember of the gratuity act -
1) yes, 5 yrs of continued service makes a person elligible for getting gratuity
2) 4.6 yrs means he/she has not completed 5 yrs.
the rounding off after decimal happens after 5 yrs r complete - that is to say - 5.3 yrs = 5 yrs (for calculation purposes)
5.7 yrs = 6 yrs (for calculation purposes)
this is as far as i know, i wud like the senior members to confirm.
Cheers,
Pallavi

Hi
Pallavi,
Thanking you for your reply. Because my consultant told that if an employee completes 4.8 months of continue service he is eligible for gratuity.
Anyway now I am clear.
Thanks lot
bye for now
kanaka

Hi,
5 years of completion is must to get the gratuity amount from employer. if it is 4.9 years we will considerd as non completion of 5 years
this is for your information.
regards
Sambasiva Rao

Dear Kanaka:
What you have mentioned regarding the payment of gratuity in case of completion of 5 years true to the best of my knowledge.
To the best of my knowledge: Madras high court has held that an employee rendering continuous service for a period of 240 days in the fifth year will be deemed to have continued in service for 1 year (completion of 5 years). That is, 4 years 10 months and 18 days if completed he/she is liable for Gratuity.
In one of the reference books, its clearly mentioned that 4 years 6 months is considered as 5 years and hence the employee is entitled for gratuity.
Hence kindly re-check.

hi all,
as far as i know gratuity is given only after completion of 5 yrs. not less than that.
but i had another query ... is the time of probation also included in the calculation of gratuity?
... as in if a person is on probation for 6 months, so will the gratuity be calculated from his/her date of joining or from his/her date of confirmation?
Regards,
Pallavi

Yes, the probation period will also be included for payment of gratuity. The Payment of gratuity act speaks about continuous service of 5 years. It further clarifies the days to be included where a person is not in continuous service. Please be clear that gratuity will be calculated from the date a person has joined his service and not from the date of confirmation.
Cyril

Hi Kanaka,

ur question is quite an intelligent one.

What the Payment of Gratuity Act says is that "Those persons who have completed their five yrs of continuous service, they r being entitled for the payment of gratuity".

Actually in the real sense, the gratuity is being paid to the employees for their faithful continuous service in the company.

As per ur question, the time period of service is 4.6 yrs, which is for the calculation purpose is considered as 5 yrs. If the provision will be like this, then he/she is eligible for the payment of gratuity.

As per the Act, a person can also be entitled to payment of gratuity though he/she has not completed the period of continuous five yrs, in a condition that-

1) If he/she is discontinued his/her work on account of permanent disablement, or

2) on account of his immature death.

In these above two conditions, he/she is entitled to get the payment of gratuity though he/she has not completed his/her five yrs of continuous service.

But, out of my concern, what i thing is that the person is not qualified for the payment of bonus. The period of 4.6 yrs will not be considered as 5 yrs for the calculation of gratuity.

Santosh Dash.

M.A in IR & PM,

Berhampur University,

ORISSA.

I agree with Vidya i have read this judgement of Madras High Court in one of the issue of LLR.

Dear All
i am new to this site.This site is really helpful to improve HR Skills.
Reg. Gratuty i've few queries on eligibility criteria.
a) is it from the date of join or from conformation date?
b) Suppose EMP dies oneday after joining. Is he eligible for Gratuty.
C) For computing 5yrs services, do we count sick leaves as service period.
Please kindly help me.
Kind Regards
G V Anil Kumar