Denied Gratuity After 8 Years: How Can I Claim What's Rightfully Mine?

My company, Mars-India, has denied me payment of the gratuity. The reasons given by them are that the client company has not paid them in full for the services they provided. I worked for Mars-India, and I was on the payroll of Mars-India. After 8 years of work, I resigned, and they provided me with a relieving letter. When I asked for the gratuity, they said they would inform me when they decide to give it. After a year, when I contacted them, they said to do whatever I wanted to do as they would not provide it. They suggested going to court or taking any action I desired.

I currently work in the USA and have come for a 20-day trip to India. Whom should I report/contact, and how can I get my gratuity?

If they are so adamant about not giving you the gratuity amount, then you should hire a good lawyer.

Gratuity Payment and Legal Recourse

As per the Gratuity Act, if an employee has rendered continuous service for not less than 5 years, then at the time of employment termination, the employer is liable to pay gratuity. If the employer does not provide gratuity, it is punishable under section 9 of the Gratuity Act.

You should contact the HR department or the top management of the company. If your concern is still not resolved, you can submit an application to the controlling authority under section 8 of the Gratuity Act. It may take some time, but your concern will be addressed.

Please let me know if you need further assistance.

Regards

You are eligible for gratuity as you worked for more than five years on a continuous basis. You may file an application for direction in Form "N" (under Rule 10(1)) before the Controlling Authority under the Payment of Gratuity Act, 1972, at the appropriate RLC's office within your jurisdiction. If you need any help or advice, you may communicate the same to me.

Thanks,

Regards

Steps to Claim Gratuity Under the Gratuity Act of 1972

As per the Gratuity Act of 1972 and its rules, you are entitled to receive gratuity. Firstly, approach your employer and request payment of the gratuity by providing details of your joining and leaving. After 15 days, send a reminder emphasizing the initial letter and stating that you will be contacting the Controlling Authority under the Payment of Gratuity Act. Nominate someone you trust to represent you and argue on your behalf.

When the company you worked for is ready to face the court, there is no possibility of getting the gratuity amount from them without resorting to legal action. Therefore, do not wait. As per our friend's advice, please take this matter to the labor commissioner to seek justice.

Good luck.

Regards,
N. Ragavendiran

My colleague, Sh. Sibabrata Majumdar, has given you the correct advice. You are eligible for the payment of gratuity as you have put in more than 5 years with the company. You have to assess who is the appropriate government entity having jurisdiction to deal with the cases of your company, whether Central or State Government. Accordingly, you have to approach the Controlling Authority of the area with an application containing full particulars of your service details in Form 'N'. The employer is supposed to pay the amount of gratuity within 30 days from the date it becomes due. If it is proven that the employer has deliberately delayed the payment of gratuity, the Controlling Authority is competent to grant you the interest at the simple rate notified by the Government from time to time. The reasons advanced by your company that the client company has not paid them in full for the services they have provided shall not stand valid before the Controlling Authority. Since you are currently based in the USA, I suggest you authorize someone to appear before the Controlling Authority on your behalf after you have filed an application in Form 'N' before the Controlling Authority.

Regards,
BS Kalsi
Member since Aug 2011

Hi, this is Viswanath. Mars-India is a software company with branches in Hyderabad, Bangalore, and Mumbai.

Payment of Gratuity Act 1972

According to the Payment of Gratuity Act 1972:

Application to Controlling Authority for Direction

If an employer:

- (i) Refuses to accept a nomination or to entertain an application for payment of gratuity, or
- (ii) Having received an application for payment of gratuity, fails to issue notice within fifteen days; the claimant employee, nominee, or legal heir, as the case may be, may within ninety days of the occurrence of the cause for the application, apply to the controlling authority for issuing a direction under subsection (4) of section 7 with as many extra copies as are the opposite party:

Provided that the Controlling Authority may accept any application on sufficient cause being shown by the applicant after the expiry of the period of ninety days. [Rule 10.]

Machinery for Enforcement of the Act or Rules in Central Spheres

"All Assistant Labour Commissioners (Central) have been appointed as Controlling Authorities and all the Regional Labour Commissioners (Central) as Appellate Authorities."

In my case, I think I should approach the Controlling Authority (Central), which is the Assistant Commissioner of Labor (Central) and not State.

What do you guys say?

Thanks,

Viswanath

I sent an email to the director of the company, HR, and the finance officer. Below is the response to my email from the director of the company.

I sent the following email in December 2011. As I was in the USA, I could not reach the Controlling authority within 90 days. Can I now approach the Controlling authority with the following email, or should I send another email to the company before approaching the Controlling authority?

From: Ramesh Sundaresan

Please go ahead and take legal action... we are game for that.

Viswanath Reddy wrote on 12/19/2011 11:27:06 PM:

Ramesh,

I have sent several emails, including the one below, regarding the settlement of gratuity and leave encashment. I was relieved from Mars Telecom on April 6th, and it's been more than 6 months. I have sent several requests regarding the gratuity to you, Mahesh, and Sunil, and there has been no action taken.

Please consider this as a final request regarding the settlement of gratuity and leave encashment. Please ensure that you pay me the gratuity within 3 days, by the 22nd of December 2011. You have taken ample time, and no action has been taken until today.

If I am not paid the gratuity and leave encashment within the given time, I am left with no other option but to proceed further legally.

The Payment of Gratuity Act, 1972, and Rules made thereunder.

Rules of the Payment of Gratuity Act, 1972.

Thanks & Regards,
Viswanath

Going through a lawyer is a cumbersome process and takes a long time, so I would like to avoid lawyers for this petty issue. Should I approach the Labour Commissioner Office (Central) or (State)? Do I need a lawyer for this?

Labour Commissioner Office Central

Ati Campus, Opposite Shivam Temple, Vidya Nagar, Hyderabad - 500044

Should I approach the above address in person and give them a letter in writing? Is there any other office in Hyderabad that I should approach?

I understood from your letters that you have not submitted the Gratuity claim application form. I am attaching the same for your reference and records. Kindly fill it and send it through registered post to get the acknowledgment for further reference. Please do it as a priority. I assume you are familiar with the gratuity calculation method: Basic + DA / 26 x 15 x number of years of service.

Regards,
Alphonse

You have rightly assessed that the Central Government shall be the appropriate authority for the Mars-India software company with branches in Hyderabad, Bangalore, and Mumbai. Therefore, you have to approach the Assistant Commissioner Labor (Central), Hyderabad, who is the Controlling authority for entertaining your application under the Payment of Gratuity Act, 1972. The reason is if you go through the definition of 'Appropriate Government' given under Section 2(a)(b) of the PG Act carefully, you will find that any establishment having branches in more than one state, the appropriate authority shall be the Central Government.

You have rightly mentioned their office address, which is situated at ATI Campus, Vidyanagar, Hyderabad-500007. It shall be better if you approach personally to the Controlling Authority with Form 'N' duly completed in all respects. Your personal meeting with the Controlling Authority may bring some positive results since you have to explain the reasons for submitting the application abnormally late. Since you are in India temporarily, you may have to authorize someone to appear before the Controlling Authority on your behalf.

Regards,
BS Kalsi
Member since Aug 2011

You should approach the central labor commissioner based in Hyderabad and submit your petition. However, please don't forget to take a counterfoil for the petition submitted. I strongly feel that your last employer is not very concerned because of your current location, and people sometimes tend to overlook things like that as they don't want to deal with government offices.

I would also suggest that you consult a corporate adviser or advocate for better advice.