Is It Legal for a Software Company to Deny Gratuity and Withhold Salaries? What Can I Do?

Hi all, I worked for a software company for 6 years and 4 months and left the company in January 2014. When I asked for the gratuity, the HR person said that I am not eligible for gratuity. What should I do now? Also, the company has not paid the salary for the last two months up to date and is not responding to emails. Can you help me with how to resolve this?

Additionally, how can a private company, especially a software company, claim that they don't have a policy in place?

Thanks.

If your company has ever had 10 or more employees, the Payment of Gratuity (POG) Act applies to your company, making it liable to pay you gratuity as per the Act. Whether your company is proprietary, a partnership, private, or public limited, and regardless of whether your company has a gratuity policy or not, it cannot escape its legal liability to pay gratuity.

You mentioned that your company has not paid your salary for two months. However, it seems you are giving less importance to it. You need to write a letter to the company and request the payment of all legal dues, including unpaid salary and gratuity. Make an application for gratuity. Forward these letters to the company by Registered Post with Acknowledgment Due (AD) and not by email.

Please read my and other members' earlier posts in this forum on what to do if the employer refuses to pay you gratuity.

I agree with Keshav. The Gratuity Act is applicable to all companies subject to a minimum of 10 employees employed at any point in time. If your employment is continuous service without any break, then you are eligible for gratuity. You need to fill out Form "I" for the application for gratuity and a separate application for your full and final settlement and send it by registered post. In case of failure to settle your gratuity dues within the prescribed time limit in the act, the collector can recover the same and land revenue as per Section 8 of the Recovery of Gratuity. Furthermore, the employer can be penalized monetarily or imprisoned under the respective section. You may also be eligible to receive interest on the gratuity amount due to the delay from the employer at the general interest rate.

Please let me know if you need any further assistance.

Best regards.

You are requested to view the link provided below to understand the procedure for claiming gratuity. The Controlling Authority is the Assistant Commissioner of Labour for your area.

Link to Gratuity Claim Procedure

Thank you.

Understanding the Application of the Payment of Gratuity Act

Application of the Payment of Gratuity Act is not the choice of an organization. The POG Act defines the coverage requirements. From the particulars of your case, it appears that your employer is entitled to be covered by the Act. Please verify the coverage criteria again.

Since you have completed over six years of 'continuous' service, you are eligible for gratuity. The procedure is that you may submit your claim by registered AD to your employer in Form 'I' prescribed in the Act and Rules. If the employer refuses the claim or prefers to observe silence, you may file the matter with the Controlling Authority under the POG Act in your region in Form 'N' prescribed under the Act. The Controlling Authority will intimate the case against the employer. I suggest that you may avail of the services of a good labor law practitioner for this purpose.

Regards,
Lalit Thakkar