Gratuity Payment Dilemma: Can You Claim It After Just 3 Years of Service?

Gratuity Payment Inquiry

I want to know about gratuity payment. If gratuity is mentioned in the CTC and an employee has completed only 3 years of service and resigned, can gratuity be paid at the time of full and final settlement?

The company is mentioning gratuity in CTC only for costing purposes. Whether it is mentioned in the appointment order or not, an employer employing 10 or more persons is bound to pay gratuity to an employee upon their relieving after a continuous service of not less than five years. In the above case, gratuity is not payable.

Regards,
Varghese Mathew

Dear Swati,

Gratuity Payment Eligibility

Payment of gratuity is linked to the basic condition of continuous completed service of 5 years in the same organization. The condition of continuous service is exempted only in the following situations:

1) On an employee's death or permanent disablement due to an accident or disease.

An employee who has worked for 3 years shall not be eligible for gratuity, but the same can be shown in CTC for the purpose of future calculations. Therefore, it shall not be paid at the time of F&F if the basic condition of 5 years is not fulfilled.

Regards,
[Email Removed For Privacy Reasons]