Employer deduct gratuity from employee salary every month - it is under act?

No Employer is not authorised to deduct any amount from employee pay on account of gratuity

No such provision in Act. Employers' liability should not be deducted from Employees' salary/wages. Furthermore Employers' liabilities such as ESI, PF, Gratuity etc. are not to be treated as wages. You may refer payment of wage act.

No Employer cant deduct Gratuity from wages, as its total employer responsibility to pay gratuity at the time of separation after 4 years and 240 days or death at any time in the service period.
According to some friends its correct to put in CTC, they are misguiding to other members because for the first year if employee basic is 12000 then his gratuity contribution become 573.00
Next year his basic revised by 13500 than Gratuity become 650.00
Like this, it will increase till the fourth years and maybe 820 Now employee relives after five year and eight months when his basic is 20000 according to it his gratuity calculation should be on 962 on monthly basis for five years means 60+8=68 month
it would be 68*962=65416.00
Not according to the fixed CTC calculation.
So please its HR duty to guide their employer incorrect direction

So don't put gratuity in CTC it can be calculate after the service separation only.

The calculation as shown above is incorrect. If any employee worked for 5 years 8 months i.e 68 months and his last drawn basic is 20,000/- per month, then his gratuity amount will be (20000/26)*15*6 = 69,231/- .
Secondly the consideration that has been made that the money deducted from CTC every month will not be invested properly is not right. Either the money will be invested to any insurance or to be managed by the Gratuity trustee formed by the company.
Whether Gratuity should be part of CTC or not is the Organization's own policy as there is no legal bindings. If it is not part of CTC , question does not arise to deduct gratuity from salary - it is illegal. But if it is part of CTC , it has to be managed professionally otherwise it will also create problem.
S K Bandyopadhyay ( Howrah, WB)

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Dear Colleagues,
As I observe, enough has been said on the original query mostly repeating the same points or digressing without adding much value.
It is time we pull the plug on it if no fresh valuable views are forthcoming.
Regards,
Vinayak Nagarkar
HR- Consultant

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Employer is not authorised to deduct any amount from employee pay on account of gratuity. Employer has no right to cut it in his/her salary.

Any deduction which is no at par with the Payment of wages Act is illegal. Aside, the employer has no legal right to deduct the gratuity from his employee. In case there is any agreement to this respect it will be voidable at the instance of the employee and by Court's order.
If your employer is deducting gratuity amount every month, please get those receipts or that deduction should be reflected in your pay-slip, else it will be difficult to prove in the Court of law.

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