Gratuity - Service Conditions

MR A had joined in 2007 on regular service condition.
He has superannuated in 2010 (60 yrs completion)
After 2010, revised his service condition from Regular to Contract.
After 5 yrs of service whether he is eligible for Gratuity...
Regards,
Hemant

Since there is continuous service he will get gratuity on completion of five years irrespective of the fact that he was on regular service for a part of five years and under a contract for the remaining part of five years.
Regards,
Madhu.T.K

MR A had joined in 2007 on regular service condition.
He has superannuated in 2010 (60 yrs completion)
V hv settled his F&F, PF & other benefits in 2010 without Gratuity. Gratuity was the part of CTC.
Whether he can claim Gratuity?

Your case is likely to attract legal complications. First of all, knowing that he will not complete five years on his superannuation you should not have included gratuity as part of CTC. Secondly, if he was given full and final settlement you should have paid him gratuity proportionate to his service without reference to Payment of Gratuity Act but with reference to his appointment order which specifically said that he is entitled to gratuity.

Now, since his reappointment has been made for the benefit of the company ( there is every reason to believe that his continuing in service is badly required otherwise the company would not have employed him after his attaining the age of superannuation) you should consider paying him gratuity when he leaves the organisation provided the total service at the time of leaving including his past service is five years or more.

If you deny him the gratuity saying that his new appointment starts in 2010 only, the payment can be withheld. But, as stated, if he raises an industrial dispute, there is every chance that he may get it. This is because legally he has been in continuous service though you have changed the status of employment from 'regular' to 'fixed term contract' and that change will be treated only as a paper adjustment for the sake of employer about which the role of employee is absolutely nil. Now a days the authorities are very keenly watching on this aspect and directions are being issued in favour of employees. However, the legal verdict may take its own time.

Regards,

Madhu.T.K

Dear Hemant,
I am agree with Madhu. If the employee has attended the age of superannuation then as per his appointment order you have to pay him applicable gratuity without following the condition of continuous 5 years of service. If the employee join the organization nearest to the age of superannuation it should be predefined in his appointment order and shall be well educate him with final offered CTC.
Regards.
Ulhas

I wish to ask mr madhu that as per section 4 (a) of the Payment of gratuity act, 1972 once the employee has superannuated, can he still be in continuous service? Because superannuation will amount to cessation of service and the post retirement contract will not entitle him to gratuity.

The age of superannuation is not mentioned any where in the Act. It is purely governed by the company's policy. Therefore, any period over the age of superannuation is counted as continuous service only unless he is given settlement of terminal benefit of gratuity at the time of retirement. If you do not wish that a person should continue, stop the service and do not employ him under any status. If you do not stop it, it will be construed that his service is continued for the benefit of the organisation and if so he will be deemed to be in continuous employment.
Regards,
Madhu.T.K

Madhu,
1) Can you please explain this part of your comment? (you should consider paying him gratuity when he leaves the organisation provided the total service at the time of leaving including his past service is five years or more.)
2) Since the person is still in the employment, we can pay him at the time of resignation, death.
Regards,
Hemant

Dear Mr. Hemant,
Although you have asked these questions to Mr. Madhu and if you permit me to comment, the summary of the same is as under;
"Mr. Madhu is very widely explained each and every point in his notes mentioned above, as per him you may pay gratuitiy to the concerned or may not pay as the case may be. But issues only arise when if employee raise an industrial dispute refering appointment letter he has recieved at the time of appointment and keeping in mind the continuation of services, the authority may decide in his favour"