Understanding Gratuity Rules in Pakistan: Can Service Lapse Affect Full Payment?

kashan.gul@gmail.com
I have a situation in my company in Pakistan. Could you guys please help me out with this situation?

Gratuity Rule and Service Lapse

Is there any rule regarding 50% gratuity and also lapsing service as a 50% period? Furthermore, if the same employee applies again for gratuity during his continued service, can he be paid full gratuity up to the current date without his service being reduced? Could you guys help me sort out this problem?

Regards,
Kashan
9871103011
I support the views of my senior colleague Sh. Keshav Korgaonkar that the solution to your problem lies in the labor laws governed by labor regulations formulated by the Government of Pakistan. Since you have expressed your anxiety to know the practice in this country, which I am sure will not be helpful in your case, I am mentioning the salient features of payment of gratuity, including the forfeiture clauses contained in the Payment of Gratuity Act, 1972.

Payment of Gratuity Act, 1972

Section 4 of the Payment of Gratuity Act, 1972 stipulates that gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years: (a) on his superannuation, (b) on his retirement or resignation, or (c) on his death or disablement due to accident or disease. Provided that the completion of continuous service of five years shall not be necessary where the termination of the employment of any employee is due to death or disablement.

Forfeiture of Gratuity

The gratuity of an employee can be forfeited wholly or partially on the following grounds:

- Whose service has been terminated for any act, willful omission, or negligence causing any damage or loss to, or destruction of, property belonging to the employer. Gratuity shall be forfeited to the extent of damage or loss caused.
- Where the services of an employee have been terminated (i) for riotous and disorderly conduct or any other act of violence on his part, or (ii) for any act which constitutes an offense involving moral turpitude, provided that such offense is committed by him in the course of his employment.

Now you can draw your own conclusion regarding the possibility as you have inquired in your subsequent posting.

Regards,
BS Kalsi
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