How to Calculate Gratuity for an Employee with a Break in Service?

My company was registered as a Pvt. Ltd. firm in 2008. One employee who joined in 2007 is now resigning in 2015. In between, she took a one-year leave. She is claiming her Gratuity. What I want to know is, should I consider the years of service as 7 or 6? (2007 to 2015 - 1) = 7 or 2008 (company registered) to 2015 - 1 = 6.

When she has not served 240 days in a year, she is not eligible for gratuity. Therefore, you can only give gratuity for 7 years of service.

Ok, thank you Jagat. What I wanted to know was, can we reduce mentioning the company's registered year? She joined in 2007, and the company was registered in 2008.

No matter whether a company is registered or not, do not deny the gratuity eligibility as she joined in 2007.

Hi,

She is eligible to receive gratuity for 7 years.

With regards,

Mr. Thumbs Up

Dear Jeena,

If she has not worked for 240 days in a particular year, you need not consider that year for paying gratuity. Your calculations will be for 6 years. The date of joining will be considered, not the co-registration, for calculating gratuity.

Regards

Nomination for Gratuity (Sec 6)

Each employee who has completed one year of service is required to make a nomination for the purposes of gratuity in the case of their death. There can be more than one nominee (Form F). Nominees may be changed at any time by the employee by giving written notice to the employer (Form H). If no nomination has been made, it shall be paid to the legal heirs of the deceased employee. If the heirs are minors, the share of such a minor shall be deposited by the controlling authority with a bank until they attain majority.

If no nomination is named, you may ask the nominee to prove they are legal heirs of the deceased person by providing certificates like a family ration card, marriage invitation, etc.

Dear Praveen ji,

Thank you so much! Could you please explain to me the following:
1. Claimant Statement Part-1
2. Employer Statement Part-2

In the context of gratuity payment?

Thanks

The constitution of the establishment and its subsequent changes, whether in its form or ownership, have no relevance to the payment of gratuity. What is relevant is the continuity of service of the employee in the establishment, completion of qualifying service of not less than 5 years of continuous service on normal termination of employment, and rendering of continuous service in every year.

Dear Sir/Madam,

I would like to inquire whether an employee who has been working at a company registered under the Shop Act since 2010 is eligible for gratuity up to August 2015.

Thank you.

Hello Jeena Elsa,

When did the employee take a 1-year leave? If it happens to be somewhere in between, thereby not completing 5 continuous years of service, she wouldn't be eligible for Gratuity. The key word will be continuous, as other members mentioned.

Regards,
TS