Gratuity Payment for Long-term Employees: Is Your Employer Obligated to Pay?

If an employer terminates the employment of an employee who has worked for more than 5 years in the company, is the employer liable to pay gratuity to that employee? Please suggest.

Thanks & regards,
Varsha Nagpur.

Gratuity is payable if an employee has completed continuous service of 5 years as per Section 2A of the Gratuity Act 1972.

Gratuity should be paid regardless of whether the employee left the job voluntarily or was terminated by the company.

The company should pay gratuity to an employee who has resigned or whom the company is terminating if the employee has completed 4 years and 240 days in the 5th year. According to the amendment in the Gratuity Act, gratuity is applicable after 4 years and 240 days.

Thanks & Regards,
Dashrathsinh Jhala

Companies should pay gratuity to employees who have resigned or have been terminated by the company if the employee has completed 4 years and 240 days in the 5th year. According to the amendment in the Gratuity Act, gratuity is applicable after 4 years and 240 days of service. A judgment given by the Madras High Court in a similar case where the employee had completed 4 years and 240 days resulted in the employer paying gratuity.

Thanks & Regards,
Anil Sharma
[Phone Number Removed For Privacy Reasons]

In the given case, if the termination was not a result of any disciplinary action, the employee cannot be denied gratuity as per Section 4(6) of the Payment of Gratuity Act.