Can You Claim Gratuity After 33 Years of Service? Seeking Clarity on Eligibility Rules

Respected Seniors, The Payment of Gratuity Act, 1972 specifies a minimum continuous service of 5 years to be eligible for gratuity benefits but is silent on the maximum number of years of service. It simply mentions the amount of the Gratuity limit to be Rs. 10 lakh.

Eligibility for Gratuity Beyond 33 Years of Service

Does this mean that a person who has more than 33 years of service, in the present case 37 years, is eligible for gratuity? This would be computed as follows: salary X 15/26 x 37 = gratuity amount, and the amount of gratuity is within the prescribed limit of Rs. 10 lakh as amended by the notification dated May 24, 2010.

Kindly guide.

Regards, Harminder

An employee is entitled to have their entire service period counted for gratuity without any maximum limit until the date of retirement. However, if the gratuity amount exceeds Rs. 10 lakhs, the employee is eligible only for Rs. 10 lakhs.

Regards,
B. Saikumar
HR & Labour Law Advisor
Mumbai

Thank you, Mr. Saikumar! I have further researched various judgments. This calculation formula is also applicable under the Industrial Dispute Act.

Regards,
Harminder

If a person who had 30 years of service on their retirement date is given a 4-year extension without a break, will they receive gratuity for 34 years?

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In my view, if the extension is in continuation of the existing tenure of service and he retires after 34 years of service, he should get gratuity for 34 years.

B. Saikumar
HR & Labour Law Advisor
Navi Mumbai

Respected Members,

I am employed in a tea company that operates several tea estates and factories. A significant number of our staff and workers have dedicated 35 to 40 years of service.

Maximum Limit on the Length of Service for Gratuity Payment

As we are aware, the minimum requirement for eligibility to receive gratuity is 5 years. However, the question that arises is whether there exists a "maximum limit on the length of service" for gratuity payment.

I would greatly appreciate a clear response, including any relevant legal judgments, if available.

Thank you,

Mahesh Khandelwal
[Phone Number Removed For Privacy-Reasons]

Hi, The minimum continuous service of 5 years is the eligibility criterion for Gratuity. However, there is no maximum limit on the length of service as per the Gratuity Act. In terms of Gratuity payment, it is tax-free up to Twenty Lakhs.