Facing Pressure to Resign Before Gratuity Eligibility: How Should I Respond?

Pregnancy Leave and Employment Concerns

I have been working with a private company for the past 4.9 years. On February 17, it was detected that I am pregnant, and as per the doctor's suggestion, I took a one-month leave for bed rest. I received a salary for that month as I utilized my leave balance. The situation continued as the doctor extended bed rest for one more month. I didn't get any salary for March as I exhausted my leaves. Within that month, I had a miscarriage.

Manager's Request for Resignation

Now the manager is asking me to resign, as according to him, I can't handle the pressure, which is not true. I have even submitted the fitness certificate. He wants to go backdated in the last financial year and pay me for March, April, and May. I will complete 5 years in July. He is denying my gratuity, saying every company has different rules, and some companies pay after completion of 4 years and 240 days, while some pay after completion of 5 years.

Request for Resignation Date Adjustment

I asked him to make my resignation date in April so that I will complete my notice period and reach 5 years on the same date, but he is not agreeing. Experts, please help.

Please clarify what is your Gross Salary? Are you an employee covered under ESI Act? For miscarriage, claim benefits provided in the Maternity Benefit Act, 1961, if the same is applicable. If you have decided to submit resignation, please submit the same with the present date not from a back date. Further, please comply with the notice period requirement as per the terms of appointment. Until there is clarity, hold your resignation letter. Please do not yield to the pressures of HR or any officer.

Please do not resign. You are entitled to gratuity payment under the Payment of Gratuity Act. There is one law on gratuity and every company is obliged to follow that. Companies do not have any option. The manager is trying to bully. At your convenience, you can approach the gratuity authority, which is the labor commissioner.

Illegal Practices by the Company

Whatever your manager or company is telling you is totally illegal and an attempt to get rid of you to avoid statutory compliance. As advised by others above, PLEASE DO NOT RESIGN.

Maternity Benefits

Regarding pregnancy (whether delivery or miscarriage), the Maternity Benefit Act is applicable to you if there are more than 10 employees in the company. Under the Act, you are entitled to 12 weeks of paid leave and other benefits, which is now extended to 26 weeks. During pregnancy, no woman can be terminated from her service. In case you are covered under the ESI Act, then you will receive maternity benefits from the ESI Act. Whatever the scenario is, you are at least entitled to 12 weeks of paid leave according to the old Act. So the company is really engaging in illegal practices.

Gratuity Entitlement

Regarding gratuity, gratuity is payable only upon cessation of employment. Though you are advised not to resign at this stage, if you wish to resign at your own will, then comes the question of calculating gratuity. Gratuity is payable for continuous service of 5 years, i.e., if you have worked for 4 years + 240 days in the 5th year, you are entitled to gratuity. Again, as usual, your company is misleading you. They may claim different rules for different companies, but if you ask them to state that in writing, they will likely avoid doing so.

Action Steps

I suggest that you simply make an application under the Maternity Benefit Act seeking maternity leave and benefits. Submit such an application with proper acknowledgment, most probably through registered mail or AD post. This action will likely put the company on the defensive.

I strongly advise that you DO NOT RESIGN AT THIS STAGE. Companies like this need to learn a lesson.

Thank you, experts, for taking the time to answer my query. I am highly obliged by this gesture. I did not want to resign as I was considering engaging myself in work to help me forget my loss in miscarriage. Unfortunately, I couldn't endure the mental harassment, and I ended up resigning. My employer agreed to provide a 3-month notice period pay. Initially, he agreed to pay gratuity as I had completed 4.9 years and 1 day on the same day, i.e., 3rd April 2017. However, at the time of my departure, he informed me that the company policy requires completing a full 5 years to be eligible for gratuity, not even a day less. I tried to persuade him to consider my resignation date as 3rd April 2017 instead of backdating it to 1st March 2017. By doing so, I would complete 5 years on 2nd July 2017, coinciding with the completion of my 3-month notice period. Unfortunately, he simply rebuked me, accusing me of lecturing him on legal terms.

The latest update is that I sent an email to the founders the day after our discussion, but I have not received any response from them. This weekend, I plan to send them a reminder email, and if they do not respond, I will pursue legal action. The time has come to assert ourselves and make these individuals understand their place. I will keep you all posted here. I would appreciate hearing from you if you have any better suggestions for handling this situation.

Since you have submitted your resignation, there is no requirement to consider the maternity benefit. After your last day of service, you must send FORM I by registered mail to the company to claim gratuity. Wait for one month for payment; if the company does not pay, you must file a case against the company before the controlling authority. There appears to be no need for verbal communication with the company.

Thank you, Ritesh. The last date they have conveyed to me is 31st May 2017. Along with the full and final settlement, I will receive the experience letter by 10th June 2017. They won't calculate the gratuity in that calculation. Do you want me to wait until I receive the experience letters? If they consider 31st May 2017, then I would have completed 4 years, 10 months, and 27 days. Do you think they will trap me in their policy terms, saying we pay gratuity only after completion of 5 years, not before that?

I apologize for so many questions, but I am just considering all aspects. Could you please help with any references to a labor law advocate in Mumbai?

Regards, Roop

Dear Roop ji, you are from Mumbai. Since you have not completed 5 years of service, you are not eligible for payment of gratuity under the POG Act. The law is very clear on this, in my view.

You have already tendered your resignation to your employer. Presuming that your employer has not issued you a letter of acceptance of your resignation, I would suggest that you should serve a letter to your employer immediately, stating that you tendered the letter of resignation under mental pressure and now you want to take it back.

Your employer will not accept this letter definitely and will issue you a letter of acceptance of your resignation. Therefore, you have to send this letter to him by Regd AD.

Eligibility for Gratuity

If your last date of work is 31st May and you have completed 240 days in that year (which I assume you have), then you will be entitled to gratuity, in my opinion. As they have stated that your full and final settlement will be done on 10th June, it is better to wait until that day (it's just a matter of 10 days). Once all your settlement is complete and you have your experience/relieving letter in hand, you may immediately ask for gratuity by sending Form I with acknowledgment.

They may try to enforce their policy, but remember that the Payment of Gratuity Act supersedes their policy.

Dear Adv. Ritesh Maity ji, the topic of gratuity for less than 5 years of completed service has been well discussed here on this forum time and again by many experts. I have also contributed to this discussion many times. There are different views on it, and therefore, I stopped contributing on this subject again.

You, being a practicing Advocate in Labour Laws, I request you kindly go through some of the earlier discussions on this topic, including mine, and help us/me to understand the law correctly.

Thanks a lot in advance.

Dear Member,

First of all, I must appreciate the enthusiasm and courage you have shown during this difficult time (for a woman, miscarriage is the toughest period to overcome). You have the determination to reclaim your rights and are making efforts to find different ways (ethical, legal, and logical) to win your fight for justice. You have not stated whether you had ESI facility or not. If so, then the employer is not bound to pay any compensation towards "Miscarriage." I really appreciate that, in order to keep it confidential, you started the thread with "ANONYMOUS," but later you mentioned (disclosed) your name. I suggest removing your name because, as you are planning (making effort), someone from management might also be reading the thread. If you really want to fight legally, take every step from a lawyer's point of view.

The members (who have contributed above) are well known for their valued suggestions in the forum (especially Mr. Ritesh and Mr. Korgaonkar). However, they have different opinions towards gratuity.

Since you have given your resignation, taking it back is not logical as the company will get the idea that you have some backup plan. I would also suggest working until the last day they allow you to work. By that time, you will cover most of the period to qualify for gratuity payment. Meanwhile, please don’t sign any document that resembles your entitlement for Full and Final Payment.

Gratuity Entitlement

Rightly said by Mr. Korgaonkar, as per the ACT, an employee is entitled to gratuity only after 5 years of continuous service. The term "240 days" came into existence on the basis of qualifying 1 year of uninterrupted service. An employee shall be deemed to be in continuous service if he has been actually employed, during the preceding twelve months, for not less than 240 days. On this basis, we assume 240 days working in the fifth year will be entitled to 1 year of service (hence five years completed for Gratuity entitlement).

Though the term of 240 days for the 5th year is neither provided in the Act nor has any Amendment been issued, we have heard in many cases that the Hon’ble court has given decisions in favor of employees for 5th-year eligibility against gratuity payment if the employee has worked for 240 days in the 5th year.

Full and Final Payment

With regard to full and final payment, I have a separate opinion. Don’t accept the Full and Final amount and don’t sign over the F&F Sheet. If you can, ask them to give a copy of the F&F Sheet (by giving an excuse to show this to your family), please take a copy of the sheet.

Later, instead of accepting the F&F, in response, you can write a letter regarding your miscarriage and gratuity payment as well. If they don’t accept/reply to your letter, please contact a lawyer. In my opinion, you will definitely win the battle.

This is my biggest conversation in a single thread, but I considered different opinions to cover most points. Hope you will find it as per your requirement.

Good Luck.

I really appreciate Pan Singh Ji, Ritesh Sir, and Korgaokar Sir for your detailed views. I don't contribute towards ESIC. I work with a 5-day working company. If they proceed ethically and accept my resignation from April 3rd, then I will complete 3 months on July 2nd. However, they don't want to pay the gratuity; hence, they are backdating and not allowing me to complete 5 years. I am not asking for a maternity claim as no claim or money can heal the pain I have gone through. I just didn't like their approach towards a loyal employee. It's not about money, sir; it's about my dignity, as he is not allowing me to come to the office. I hope you understand my situation. If anyone can help me, a labor lawyer in Mumbai, please help.

Practical Steps for Legal Action

Stop being emotional. Emotions have no value in the legal system. Think and work practically.

Since you are no longer interested in maternity benefits, then move on. Regarding gratuity, after the last working day, send them a notice in FORM I via registered mail with acknowledgment due. Let them refuse in writing, and only then can the next course of legal action be decided.

You have just stated that your employer is not allowing you to continue duties. If so, state the fact in writing with proper acknowledgment to the management. Hope someone from Bombay will be able to guide you to a local labor matter advocate.

Dear Advocate Ritesh Maity Ji, in my view, if the last date of working is accepted as per the company, the company is definitely going to deny payment of gratuity to her within the framework of the law, and she will not have any remedy. The judgment of the High Court Madras and the judgment of the High Court Kerala have no binding effect in the jurisdiction of the High Court Mumbai. The judgment of the Supreme Court quoted by many members in this forum has no relevance to the payment of gratuity.

I advise the lady to approach any of the practicing advocates in Mumbai without spending much time with all relevant papers in connection with her employment and resignation.

Keshav Korgaonkar Advocate and Legal Advisor Mumbai

Dear Friend,

What had to happen has happened. Now the question is, whether you are eligible to get Gratuity or not. As per the policy, one needs to complete a 5-year tenure of continuous service. You are squarely eligible if you have completed 5 years of continuous service till your resignation.

Wait until all your backlog amounts are paid and you receive the service letter. Then you can pursue your case for the claim of Gratuity by seeking legal intervention if necessary. Keep patience.