Applicability of the Payment of Gratuity Act, 1972
A very good question indeed! If we analyze the application clause of the Payment of Gratuity Act, 1972 under section 1(3), we will find that the employment of a minimum of 10 employees is the necessary criterion for the applicability of the Act only in respect of the shops or establishments defined as such by any law in force in the state and other establishments notified by the Central Government under sections 1(3)(b) and (c) respectively. Such a shop or establishment can be a single unit or an entity comprising several units/branches in different locations. When it is the latter entity comprising different branches, it should be treated as an organic whole, and the employees in the branches would be covered by that Act notwithstanding the strength of each branch.
For obvious reasons, the branches may be closed separately at any time or along with the entity as a whole. Therefore, the notice of closure in Form C should be submitted before 60 days on any such occasion to the Controlling Authority.