Can I Claim Gratuity in My Final Settlement After 3 Years and 10 Months of Service?

Guidance on Gratuity Payment

I need guidance on gratuity payment. In my CTC, the gratuity amount was included as a part of the CTC. Recently, I resigned from the organization after providing service for 3 years and 10 months. I want to know whether I can claim my gratuity amount in my final settlement. What would be the procedure, and is there any clause in the Gratuity Act that allows including gratuity as a part of CTC, and whether the same can be claimed only after completion of 5 years?

Please guide.

Please go through the provisions of Sections 4, 4-A, and 7 of the PG Act, 1972, and you will understand that the sum of gratuity determined under the Act upon termination of employment is by the employer only, and no contribution from the employee is required. Simply put, CTC is an accounting tool projecting the overall annual cost of employment per employee to be used in salary negotiation, and as such, it has no legal status. When any statutory liability of the employer is shown in the CTC, it is automatically implied that it can be discharged only when the statutory norms for such liability are fulfilled.

Dear colleague, there is no statutory provision in the Gratuity Act to include gratuity cost in the CTC. However, the employer has to consider it as a liability to pay it firstly, upon the death of an employee irrespective of the service put in, and after completion of a minimum of five years' service. If the employment ceases before completion of five years' service or if the employee does not die, nothing is payable to him by way of gratuity.

Regards, Vinayak Nagarkar HR and Employee Relations Consultant