Gratuity After 4 Years: Do Terminated Employees Still Qualify for Payment?

In case an employer terminates any employee who has completed a 4-year service period in the present organization, will the terminated employee be entitled to gratuity or not?

Please advise.

With Regards,
Jitendra Singh

Even if an employee is terminated after completing 4 years of service, they are still not eligible for gratuity. Five years of service is a requirement to be entitled to gratuity. The statement that our friend made about 4 years and 6 months is absolutely wrong.

Thank you.

As per my understanding, if a person completes 4 years and 240 days of service, he is eligible for gratuity.

Regards,
Haris
Human Resources

Gratuity is paid to all such employees upon their resignation or retirement. In the case of resignation, gratuity is paid to employees who have completed 5 years of service.

Regards, Rena Bhardwaj

As per the Act, an employee who has worked for 5 years in an organization is eligible for gratuity. According to the Madras High Court Decision, an employee who has worked for four years and more than 240 days in the fifth year is eligible for gratuity, taking into consideration the definition of continuous service of one year as per the Factories Act. A terminated employee is also eligible for gratuity unless their services were terminated as detailed under section 4(6) of the Gratuity Act.

No, he is not entitled because he has not completed 5 years of service. Again, in the above case, his 4-year tenure should be as a regular employee and not as a trainee before becoming an employee.