Our Co is facing this problem on gratuity. We have employees who resign onsite and have over 5 years of service at time for resignation.
While they are deputed onsite they are paid only local salary. This onsite local salary includes a component called the Indian Basic salary converted to local currency and an equivalent amount of 12% is deducted towards PF contributions. This is hiked year on year during which the Indian basic salary and also the PF proportionately changes
But while making gratuity payments, our organization is calculating the Basic salary as the last drawn basic salary while in India which could be quite different compared to the current basic Indian salary which is converted to local onsite currency and paid.
Is this correct as per gratuity policy act.
While they are deputed onsite they are paid only local salary. This onsite local salary includes a component called the Indian Basic salary converted to local currency and an equivalent amount of 12% is deducted towards PF contributions. This is hiked year on year during which the Indian basic salary and also the PF proportionately changes
But while making gratuity payments, our organization is calculating the Basic salary as the last drawn basic salary while in India which could be quite different compared to the current basic Indian salary which is converted to local onsite currency and paid.
Is this correct as per gratuity policy act.