Gratuity Applicability [Thread 369130]

Dear Preeti,
It is true that Gratuity Act specifies 5 years of completion in service but he/she could be eligible if she has completed 4 years and 240 days or 8 months . as serving the company for 240 days means completion of an year in the services.
Mala R. Sawant
9892022256

Dear All,
If you see we here are taking about a beneficial legislation, which means that we have to give the most liberal interpretation possible. If you go to court the same rule will be and is applied by the Court. So it is better to adopt the policy of 4 years + 240 days to avoid any unnecessary litigation.

Dear Mr. Amarjeet Singh,
I wholeheartedly agree your perception. A solution with a HUMAN FACE. But such concern for employees is rare with steadfast managements.
I also thank all the involved for their useful contribution in the discussion with a special reference to Mr. Tyagi.
Also, hope Ms. Preeti would have concluded as to what is the outcome.
Regards
Vimal Radia
+91 96625 48601

Gratuity is payable, if your complete 4 yrs and 240 days of working in the next year i.e. 5th year in continuous service.
Regards
Sharad Choudhary

Dear Viswam,
i have a doubt
"MADRAS HIGH COURT Decision for 4 Years 10 Months and 18 Days in the 5th year, will be entitled to gratuity" is this decision applicable for other states.
thanks in advance
Regards
Krishna

Nice input from so many experts.

But still I feel the Gratuity Applicability is only after completion of 5 full years.

Any way it all depends on the Organization how they treat their employees. If Organization wants to pay for those who have completed 4 years + 240 days Gratuity fine.

In case any Organization / Company decides to pay Gratuity only after completion of 5 years, then the concerned Employee to take a call whether to resign or continue with Organization to complete 5 full years of Service.

Here the concerned Employee may ask one question - I am getting better opportunity; they will not wait for me to complete 5 years for Gratuity eligibility etc".

In that employee to act wisely, calculate and add his gratuity amount (which he or she would have got from the present Organization) / (divided by) 12 or 18 months, add up to his expectation from the Future employer and settle for the deal!! If the candidate is so fit - the future employer will pay that much amount (all these bargaining without revealing to the future employer that the candidate has added up his Gratuity amount which is being forfeited just because 5 full years of service not completed).

Resigning close to 5 years - I would request the employees to be very careful before opting for same - unless & otherwise the offered employment is too good in many aspects.

Think, think twice or thrice before we act. Good wishes,

sundararaman

Give me a break in this discussion....

The Act Payment of Gratuity is framed for the purpose of social security of employees..

this is the main and core object behind the act.

Now come to our discussion, that the gratuity act ask 5 years of continuous service to be eligible for amount of gratuity.

an act impliedly says and conveys that employees are became eligible for gratuity only after completing 5 years of continuous service and not one day more than that. if any employer makes an eligibility as 6 year than he is going to guilty in the eyes of Law.

So the hard of the story is that its an employer's wish to pay gratuity to the out going employee even if not complete 5 years. if more than 5 years than he is bound to pay but what i wish that employer has to look for the social security of out going employees rather than any other aspects and he should pay even if the criteria of Act doesn't match. because ultimately that employee has worked for us and has contributed a lot to the growth of the company.

Be Humanistic..

Have a Good Day..

Dear Mr. Rinkesh,

You have concluded with an excellent words "Be Humanistic". Fantastic.

Both ways - from Employee side and from Management side - humanistic do apply + the performances of the employee/s which keeps them in employment in the same Organization for 4 years + 240 days or so.

Hence considering the aspects of benefits, other good things or even gestures the employee enjoyed from the Management of the Company, the Employee can also be humanistic to continue with the same job (to complete the 5 years in full to become eligible for Gratuity under Gratuity Act).

Still if the Employee gets much much better opportunity and in no way the future employer can wait - then the option is very much IS in the hands of the employee how to get compensated for the loosing amount by way of Gratuity.

E.g Mr. A or Ms.B is drawing 20000 (basic+DA) and worked for 4 years+240 days, then gratuity amount (which is being argued above) would work out to Rs. 20000/26 days x 15 days x 5 years = 57,692 / 12 months (comp: 4808) or 57692 / 18 months (comp: 3205) – the employee who decides to quit, can as well add up this much amount with his expectation and both ways it suits, the future employer is going to offer the package the employee finally settled in for.

Hence the humanity (or integrity!) too should come from the Employee. Having enjoyed the benefits of the Company, for 4 years + 240 days, the same employee CAN AS WELL BE “HUMASTIC” TO THE MANAGEMENT.

He or She can either wait for completion of 5 full years, then try for other jobs (OR) he or she should be ready to forgo the Gratuity from the present Organization (if at all the Company strictly follows the Gratuity applicability rules) and smart enough to get compensated from his future employer adding to his expected package.

This won’t be applicable to the Organization or Company who would be kind enough to consider to pay the Gratuity amount to employee who preferred to leave after serving 4 years + 240 days which is being argued as above.

Sundararaman

Hi friends,
there seems to be no end. I believe that enough has been discussed on this topic and everything is now clear even to a beginner. NOW LETS START SOME OTHER TOPIC FOR THE SAKE OF THIS SITE.
THANKS & REGARDS TO ALL THE EXPERTS AND FOLLOWERS.
Amarjeet Singh

Dear seniors
Please let me know if a employee done his contineous service of 5 years but during 5 years of his service he took 6 months leave for hosptalisation...can he eligible for graduety?