How Can NGO Employees Secure Their Gratuity After a Project Ends?

Social Development Organizations and Project-Based Employment

Social Development Organizations (NGOs) typically offer jobs based on the project life cycle and fund availability, which usually last 3 to 5 years. When employment is provided by the organization and gratuity is included as part of the CTC, after three years of completion, the project phases out (closes). Employees are then notified about the project's closure, leading to the discontinuation of services due to the project's closure.

Claiming Gratuity After Project Closure

How can an employee, whose gratuity has been deducted for these 3 years, claim it from the employer?

Dear Zehra Khalid,

Firstly, I'd like to bring to your notice that gratuity under the Payment of Gratuity Act, 1972, is a terminal benefit payable to an employee based on certain years of continuous and blemishless service under the same employer. As of today, it is five years for any kind of termination of employment other than death. Payment of gratuity is an exclusive liability of the employer in which no contribution from the employee is required. Whether the establishment is an NGO or otherwise, once the Act applies to it and the outgoing employee has completed the minimum qualifying service, the NGO has to pay him the gratuity due notwithstanding its fund position.

Secondly, the reflection of gratuity in the C.T.C of the employee, ipso facto, does not imply any periodical deduction from his salary, nor does it entitle him to gratuity upon the termination of his employment before the completion of the minimum qualifying service.