Am I Eligible for Gratuity After Working at an MNC from 2007 to 2013?

Hi, I joined an MNC in September 2007 as a trainee. After 6 months, I transitioned into different roles, and my last working day with this company was in January 2013. Am I eligible for gratuity?

Thanks in advance. Please reply.

If you have completed 240 working days in the last year, i.e., from March 2012 to January 2013, then you are eligible for gratuity. As per the Payment of Gratuity Act, an employee is eligible for gratuity only after completing five years. However, there have been many judgments given by High Courts from time to time stating that an employee is eligible for gratuity if they have completed 240 days of work in the last year of their service.

Thank you for the valuable reply. Yes, sir, I have completed almost 9 months, approximately 270 days, in my 5th year. On which act can I get my gratuity? Can you explain so I can check with my HR team?

Thanks in advance.

Regards,
Sudhakar

Madras High Court Judgment on Gratuity Payment

Dear Sudhakar, please find attached the Madras High Court judgment regarding Gratuity Payment.

Regards,
RK

Here is the attachment which I missed in the previous post, as per the Payment of Gratuity Act.

Regards,
RK

In support, please refer to the attached Supreme Court judgment and Tribunal judgments regarding the "240 days" stipulation for gratuity.

Regards,
Kumar S.

Yes, Sudhakar. 240 days should exclude Sundays and holidays. The definition also states that continuous service of 5 years and a minimum of 240 days in every year.

Regards,
RK

"Leave with Wages" is also considered as working days. Suppose you have availed 20 days of paid leave and worked for 220 days, then this will be considered as 240 working days.

Regards,
RK

Clarification on Service Duration for Gratuity

Why do you need to use the '4 years 240 days' principle to claim 5 years of service? Since you joined in September as a trainee and were confirmed after the trainee period ended, your service should count from September 2007. Therefore, you completed 5 years of service by September 2012.

Regards,
B. Saikumar
Mumbai

Dear Sudhakar, please mention the date of joining the company for both the Trainee and On-roll positions, as well as the exact date of leaving.

Regards, RK

Dear Sudhakar, tell them that Sec. 4(1) of the Payment of Gratuity Act 1972 prescribes 5 years of continuous service for being eligible to claim gratuity. You joined the service in September 2007 and left it in January 2013, thus completing a continuous service of 5 years and 3 months. Thus, you have fulfilled the eligibility criterion under Sec. 4(1).

Definition of Continuous Service

Sec. 2-A defines what is continuous service. While defining continuous service, it includes even the following periods of absence in service as part of the continuous service:
- the period of lay-off
- the period of leave with wages
- the period of absence due to temporary disavowment
- the period of maternity leave (in the case of female employees)

Thus, nowhere in either Sec. 4(1) or Sec. 2-A have excluded the period of training from being part of continuous service. When even certain periods of absence were made part of continuous service, excluding the period of training during which you were on duty was violative of the provisions of the Gratuity Act.

You can present your case based on the above lines.

Regards,
B. Saikumar
HR & Labour Law Advisor
Mumbai

Gratuity is payable for the training period also. This subject, along with other issues on gratuity, was discussed on citeHR a few years back as well. Please go through this link: https://www.citehr.com/20184-applica...act-labor.html.

You can also refer to the Allahabad High Court judgment on this issue. The test is attached.

Regards,
Kumar S.

Thank you very much for your valuable suggestions and points, which have given me more confidence to get my gratuity. I joined the company as a trainee, and after 6 months, I was confirmed in the role.

- Date of Joining: 24th September 2007
- Date of Confirmation: 24th March 2008
- Last Date: 9th January 2013

Thanks in advance,

Regards,
A. Sudhakar

As per your date of confirmation, the working period is 4 years, 9 months, and 5 days. However, the judgment for 240 days in the fifth year states that he/she should have worked for 10 months and 18 days. Please call me at [Phone Number Removed For Privacy Reasons] so that I can provide you with clear details.

Regards,
RK