Gratuity Concerns After Company Merger: Can I Claim It Without 5 Years of Service?

Hi Seema Roy,

Can I get the gratuity amount from my previous company, which got merged/acquired by my existing company, even though I have not completed 5 years yet in my previous company? What is the law regarding gratuity for this kind of situation? If the calculation of gratuity is only applicable upon completion of 5 years, can I receive the monthly gratuity deducted amount from my previous employer, or can this gratuity be transferred to the new company? Gratuity was a part of the CTC in my previous company. Please suggest.

Thank you.

Dear Seema,

It depends on the agreement made between the two companies. If the agreement states that all liabilities of the previous employer will be taken care of by the new company, then it is possible that you will be eligible for your gratuity. Please confirm this with your current employer.

If your gratuity is a part of your CTC, then in this case, some companies pay the gratuity amount on a pro-rata basis. Please confirm with your present employer what the agreement clause is regarding employee benefits.

Kindly inform me of the outcome.

Regards,
Ashutosh Chaturvedi