Gratuity for Long-term Contract Employees: How Does It Work When Contracts Renew?

jayadev-ak
Can someone let me know the procedure to initiate the release of gratuity for a contract employee of over five years? Is it based on the request of an employee or on relieving? In case the employee is once again engaged in another contract post for one year by the same employer, is he eligible for another payment?
vmlakshminarayanan
Hi, Subject to the completion of a continuous 5-year term, an employee becomes eligible for gratuity for the first term. If the same employee is once again engaged on another contract (after a break), subject to the completion of another continuous 5-year term from the date of joining in the second term, the employee is eligible for gratuity. However, if the same employee is contributing for 10 years without any break in service or contract, a single gratuity for 10 years can be paid.
If you are knowledgeable about any fact, resource or experience related to this topic - please add your views. For articles and copyrighted material please only cite the original source link. Each contribution will make this page a resource useful for everyone. Join To Contribute