Gratuity Dilemma: Should We Pay When the Vendor Changes but the Worker Stays?

Dear Sir, If the vendor changes and the worker remains the same, and he has completed five years, will we give him gratuity or not as a principal employer? Please suggest.

Amod Kumar Singh
Manager - HR

Hi, Yes, they are eligible for Gratuity.

They are certainly covered under the Act since they work for the Principal Employer, even if it is under or through a contractor. Such workers are not engaged to do the contractor's own work/job. What is important is for whom the work is done and not by whom they have been hired. As the services are availed by the Principal Employer, they should be eligible for Gratuity.

Mr. Madhu or Umakanthan can provide further clarification on this.

If the person concerned worked in the same company for five years of continuous service, he is eligible to receive payment of gratuity.

Please also visit the following link, where our senior members have commented on a case similar to yours:

https://www.citehr.com/640857-regard...important.html

Thanks.