Is an Employee Eligible for Gratuity After 4.8 Years of Service? Let's Discuss

If an employee leaves an organization after completing 4.8 years of service, is he eligible for gratuity?

Regards,
Vidya

Eligibility for Gratuity

Eligibility for gratuity is determined by whether a person has worked for an organization for a minimum of 4 years and completed 240 days in the fifth year. This entitles them to receive gratuity.

Regards,
Rathish.R

According to the judgment passed by the Honorable Madras High Court, if an employee leaves an organization after completing 4.8 years of service, he is eligible for gratuity.

Regards

Based on the said judgment (Mettur Beardsell Ltd, Madras vs. Regional Labour Commissioner), the Payment of Gratuity Act has not been amended. Therefore, the entitlement for gratuity remains the same, i.e., 5 years of continuous service. The verdict in the Madras High Court cannot be made applicable to all states. The Andhra Pradesh High Court has held in P Raghavalu & Sons vs. Addl. Labour Court that a service of 4 years 11 months and 10 days will not make an employee entitled to gratuity. Similar cases have also been reported in various other states. Therefore, unless an amendment is made to make the employee eligible for gratuity by treating his 240 days of service in the fifth year as one year, it is difficult to decide on it. However, considering the payment as a social welfare measure, a liberal interpretation shall be made by the employer.

Regards,
Madhu.T.K

I agree with Madhu, sir. The amendment is not yet done. We are having this confusion more often now. It's still 5 continuous years of completion.

Eligibility for Gratuity in Case of Accidental Death

What should be the situation if an employee, aged 30 years, dies due to an accident outside the factory premises, and the length of service is less than five years? Is he eligible under the act to receive gratuity, and for how many years?

Gratuity Eligibility in Cases of Death or Disablement

Continuous service of five years is not necessary where the termination of employment of any employee is due to death or disablement caused by an accident or disease.

Gratuity Payment in Death Cases

For death cases, gratuity is payable to the nominees of the deceased employee for every completed year of service or part thereof in excess of six months at the stipulated rate of 15 days' wages based on the rates of wages last drawn by the employee. The qualification for continuous service is 240/120 days, and for a mine, it is 190/95 days. The 120 and 95 days are applicable to working "in excess of six months or part thereof."

It is immaterial whether an employee has worked for 22 days or more in a month. Gratuity will be calculated as if an employee is working for 26 days in a month.

Any employee, once they join the company, and during their service, if accidental death occurs, they are eligible for gratuity only for the years they served in the company, such as 3 years or 4 years, as per the Gratuity Act.

Hope this clears your doubt.

Regards

Clarification on Gratuity Payment in Case of Employee's Death

Some HR professionals are under the impression that in the event of an employee's death, the employer needs to pay statutorily for the full number of years up to the retirement age. For example, if an employee's age is 30 years and he has completed 3 years of service with the company, does the company need to pay gratuity for 3 years or for 28 years? What does the act say?

Regards

Gratuity Calculation Formula

How will we calculate the amount?

Formula for gratuity calculation: Basic * 15/26 * number of years

e.g.: Basic = Rs. 10,000/- Number of years = 15 years

Gratuity = 10,000 * 15/26 * 5 = Rs. 28,846.15/-

The formula for the calculation of gratuity is Basic and DA divided by 26, multiplied by 15, multiplied by the number of years of service.

Thank you.
Regards

Gratuity Calculation:

Employee's Basic + D.A. salary × 15 × years (how many years he/she worked) ÷ 26

With warm regards,
Shobana

Please tell me which percentage or amount of gratuity is given to the worker in a specific case. How is the amount calculated in the worker's case?

Thank you.

Gratuity Eligibility Clarification

He is not eligible for gratuity. An employee should complete 5 years of service; only then is he eligible for it. If he completes 5.6 years of service and leaves the organization, it will be considered as 6 years of service, and he will get gratuity for 6 years of service.

Regards,
Derek Gomes

Formula for Gratuity Calculation

Basic * 15/26 * Number of Years

For example:
Basic = Rs. 10,000/-
Number of Years = 10 years
Gratuity = 10,000 * 15/26 * 10
= Rs. 57,692.30

Good afternoon. Can anyone help me with this query? It's urgent, so please assist me.

Gratuity Calculation Query

If the basic salary is 5000/- and the employee has completed 5.3 years of service, what gratuity amount should be given to him? Please help me.

Regards

Calculation of Gratuity

Calculation: Basic * 15 * number of years of service / 26
e.g.: Basic = Rs. 5000/-
Number of years = 5.3 years
Gratuity = 5,000 * 15 * 5 / 26 = Rs. 14,423

Regards,
Chetan