Am I Eligible for Gratuity After 4 Years and 7 Months of Service? Seeking Advice

My service with Corporate Company (private) is 4 years and 7 months, 15 days (5 days in a week) - DOJ 28-Mar-2013 and Date of relieving is (approx) Nov-2017. Whether I am eligible for Gratuity or not, if yes then let me know the amount. If not, please let me know why. Your valuable comments will be highly appreciated.

Dear Souvik, if your termination of employment takes place on 30-11-2017, the total service rendered would be 4 years, 8 months, and 2 days. Therefore, you are eligible for gratuity as per the judgment of the honorable High Court of Madras in the Mettur Beardsel case, which is generally followed in practice. The formula for the calculation of gratuity as per the Payment of Gratuity Act, 1972 is: Last drawn wages/salary divided by 26, multiplied by 15, and the number of years of service rendered. Without knowing your likely last drawn salary (the total of basic and dearness allowance only), it is not possible to calculate the amount of gratuity consequent on your proposed termination of employment in November 2017.

Thank you for your valuable comments. Sir, my salary structure is as follows:

Basic: 15,025
House Rent Allowance: 8,000
Conveyance Allowance: 1,600
Special Allowance: 13,489
Skill Premium Allowance: 2,917
Advance Statutory Bonus: 2,000

Please let me know the amount I can get as gratuity.

Dear Mr. Souvik,

As per the information you provided, the last drawn salary by you is as follows: Basic + D.A = 15,025 + 0 = Rs. 15,025. Your years of service amount to 4 years, 7 months, and 15 days, which, rounded off to the nearest integer, is 5 years.

The gratuity amount can be calculated as follows:
Gratuity Amount = Last Drawn Salary x Number of Years of Service x 15/26
= 15,025 x 5 x 15/26 = Rs. 43,342

Please note that gratuity becomes payable within 30 days of termination or relieving of employment.

Regards,
Amit

Dear Umakanthan Sir,

Nice to be interacting with you after a long gap. The topic of gratuity for 4 years and 240 days has been discussed by me several times, and I have become quite frustrated with it. Sir, do you also believe that the judgment of the Madras High Court is binding on all other states? There is a similar judgment from the High Court of Kerala.

Thank you.

Dear Korgaonkarji, I too feel happy to have this nice opportunity to interact with you once again. About the issue of completion of continuous service of 5 years by an employee under the same employer in order to become eligible for gratuity under the Payment of Gratuity Act, 1972, I still stick to my stand elaborately explained in the thread against the arguments advanced by our learned friend Advocate Mr. Kamal Kanth Tyagi. Regarding the binding nature of the judgment of a particular High Court on all other States, I do not differ from your viewpoint. However, since High Courts and the Supreme Court of India are undoubtedly the repositories of the wisdom of interpretation of our laws in favor of the social and economic justice of the weaker class of the partners of production, I am of the view that in the absence of contrary judgments by a larger bench of any other High Court or the Supreme Court on a particular contentious issue, we can abide by the decision of any High Court that advances the welfare of labor.

Thank you.

Dear Korgaonkarji, I am truly pleased with your detailed response regarding the eligibility criteria for gratuity based on an employee's completion of at least five years of service with the same employer. To clarify, my perspective differs as the Mettur Beardsel Ltd. case did not involve interruptions in service due to the employee or termination of the employer-employee relationship. Instead, it focused on redefining the term "employee" under the Payment of Gratuity Act, 1972. This redefinition was based on capping wages following a promotion to a higher-salaried position within the same establishment. In this specific scenario, the Honorable High Court of Madras considered the definition of "continuous service" under section 2-A to grant relief to an employee previously denied gratuity due to not meeting the five-year continuous service requirement.

To my knowledge, there has been no judgment aligning the subsequently defined "continuous service" under section 2-A with the original requirement of "continuous service for not less than five years" stated in section 4(1) of the Act for gratuity payment.

Thank you.

My service with Corporate Company (Limited) was 4 years and 9 months. The company policy included working half-day on the 2nd Saturday, and the 4th Saturday was designated as a day off. I joined on the 15th of February 2013 and my last working day was the 15th of November 2017. I am inquiring about my eligibility for gratuity. If I am eligible, please advise on the available remedies if my company refuses to make the gratuity payment. Your valuable comments on this matter will be highly appreciated.

Regards, Shailendra Mehta