Query on Gratuity
Company “A” was taken over by Company “B” and services of all the Employees of Company “A” were transferred to Company “B” with a condition that the service conditions will not be less favourable. Company “A” was having provision of payment of gratuity as per the Act i.e. 15 days while Company “B” is having more favourable gratuity norms i.e @ of 30 days' salary for each completed year of service.
Services of Mr Ram were transferred to Company “B” and his remaining service was only two years at the time of transfer of his services to Company "B". His total gratuity eligibility was for 26 years (24 years in Company “A” and 2 years in Company “B”)
Company “B” calculated his gratuity for 24 years @ of 15 days as per the policy of Company “A” and @ of 30 days for 2 years.
Mr Ram has disputed the calculation of gratuity demanding gratuity @ 30 days for the entire service.
Is the demand of Mr Ram legally tenable? Kindly cite some case laws also.
Company “A” was taken over by Company “B” and services of all the Employees of Company “A” were transferred to Company “B” with a condition that the service conditions will not be less favourable. Company “A” was having provision of payment of gratuity as per the Act i.e. 15 days while Company “B” is having more favourable gratuity norms i.e @ of 30 days' salary for each completed year of service.
Services of Mr Ram were transferred to Company “B” and his remaining service was only two years at the time of transfer of his services to Company "B". His total gratuity eligibility was for 26 years (24 years in Company “A” and 2 years in Company “B”)
Company “B” calculated his gratuity for 24 years @ of 15 days as per the policy of Company “A” and @ of 30 days for 2 years.
Mr Ram has disputed the calculation of gratuity demanding gratuity @ 30 days for the entire service.
Is the demand of Mr Ram legally tenable? Kindly cite some case laws also.