Is My Company Right About Gratuity Rules for Less Than 5 Years of Service? Seeking Advice

Dear All,

I worked as an HR in a garments manufacturing unit for 3 years and then resigned. During my tenure, settlements were made with basic pay + DA. Earned Leave (EL), gratuity, and bonus were calculated and paid to employees who had worked for more than 6 months. However, the company is now stating that, as per the law, gratuity will not be considered for employees with less than 5 years of service. Consequently, my settlement amount is decreasing. Please advise me on this matter.

Thank you.

Dear Hari, your statement that you worked as an HR person in the said establishment indicates that you are well aware of the Labor Laws, such as the Payment of Gratuity Act, 1972. How can you then claim gratuity upon your resignation after only 3 years of continuous service in the same establishment?

Your mention of having previously worked out a settlement for the payment of gratuity upon termination of employment, even for service over and above 6 months, cannot be considered in your case unless you provide details such as the circumstances leading to such a settlement, the type of settlement, the class of employees covered, etc., along with a copy of the settlement.