Understanding Gratuity: How Does It Apply to Short Service and Employee Death?

I request you all to update and clarify the query about the Gratuity Act as outlined below:

Applicability of the Law to Employees

- As the act states, gratuity will be paid when an employee leaves the organization after completing 5 years or 240 days of continuous service. If we consider 240 days * 5 years = 1200 days, this equals 3.28 years of service.

Gratuity in Case of Death

- In the case of death, completion of 5 years is not necessary. If an employee dies immediately within a month after joining, how should we compute the gratuity?

I hope to hear a favorable reply from all of you.

Your first query is illegible. Be clear that if an employee attains services of 5 or more years, then they are eligible to claim gratuity by filling Form F. If an employee has completed 4 years and 240 days of service in the 5th year, then he/she is also eligible to claim gratuity.

Your second query is regarding how to calculate gratuity if an employee dies during the course of continued services. The formula is the current basic wage amount * total years of service * 15 / 26. In such cases, I have seen that companies are paying 5 years of gratuity even though an employee has completed 5 years of service. This step is based on the grounds of humanity.