Understanding Gratuity Rules for Small Businesses: How Does It Apply to Us?

Dear Seniors, Our company has recently been registered under the Karnataka Shops & Commercial Establishment Act. We have two sister concerns, and our employee strength has now reached 30 individuals (consolidated). Could someone please assist me with the applicability of Gratuity? Seeking assistance.

Regards, Smriti

Is the total strength of both the concerns 30? The Payment of Gratuity Act is applicable for employee strength of 10 or more. In case each establishment has crossed this strength, the PGA is applicable. In that case, you need to send the notice of opening to the concerned authorities and display the extract of the act at a prominent place. It shall be payable upon an employee (having completed 5 years of service) superannuating, termination, or resignation.