Gratuity Incase Of Termination/ Layoff/ Retrenchment Before 5 Years

Dear Experts,
I have joined in pvt. ltd. company on 01.09.2009 and my services has been closed on 01.03.2014 (Total Service : 4 years 7 months)
Kindly whether I have eligible for gratuity or not.
Thanking you and regards..
Raju

Mr Raju,
You are not eligible for gratuity under Payment of Gratuity Act.
R K Nair

Dear Mamta,
gratuity is a reward which is given by employer on doing a long term service with a single employer. it is other thing that as per law for entitlement of gratuity payment employee have to work in same company continuous of 05 years service. but there is no any law says to merge gratuity or bonus with CTC and if any employer is considered all these a part of CTC, then absolutely company have to pay it.. because it is a part of monthly CTC and when you considered it as monthly part of CTC then you have to pay.

As per the Act, Gratuity is payable on completion of 5 years of continuous services. That means that there should not be any loss of pay (that may be due to suspension/ absenteeism etc.).

Many companies count mini 5 years, i.e. only on completion of 5 years. Few companies, who thinks/ care for employees, also consider if any employee had completed mini 4.6 years of service or had completed 240 days in 5th year, that too if there should be no loss of pay in first four years or in firth year.

If any employee retires (officially as per date of birth) even before completing 5 years of services, then gratuity is payable considering that the respective employee had completed 5 years of services. Say for example, if the retirement age in company is 58 years and company hires any candidate at the age of 54 years. Employee gets retired after 4 years of service with the company. Then also in this case the employee is eligible for gratuity. But, this is not applicable in case of resignation.

There are few smart companies that will retire an employee after attaining the age of retirement and continues the services as Consultant/ Adviser. In these cases, the gratuity is applicable till the end of service/ association with the company and not till the age of retirement, as it is counted as continuous services. However, if there was considerable gap before rehiring the candidate, then gratuity is not payable.

In case of a death of an employee, the gratuity is payable calculating for the period worked with the company and for the remaining years of services considering that the employee was to work till retirement with the same company.

Thanks.

Dear Mamta,
There are different rules of retrenchment and business shutdown (Bankrupt), Organisations are not liable to pay any amount in case of completely bankrupt (After proper legal formalities, which shows that they are really bankrupt), however in case of retrenchment, organisation are in financially bad in condition, but for not paying in gratuity or firing any employee, they have to give them (Employee) proper notice and pay them one month salary in advance.
Rgds,
Ram Chauhan

Dear Mamta ji,
I agree with mahwish khan. But if the service period six month and above in case your retrechment compensation will be 50% of basic. If service is completed one year, in that case, your compensation will be 15 day of wages. Your are not liable of gratuity before 5 year. Only two cases is not considered the condition of 5 years. 1. permanently disablement. 2. Death

Dear Sir,
As per my opinion, CTC is cost to company. First of all, mostly company base CTC that means how much cost of employee. Thereafter, employer is legally right to pay the gratuity after complete 5 years.
Regards
Suresh