Are Freelance Editors and Cameramen Eligible for Gratuity After 5 Years of Service?

In the media company, some professional editors and cameramen are working and they are receiving professional fees after deducting TDS at 10% under section 194J.

Is anyone from the above category eligible for gratuity if they have been providing their services for more than 5 years?

Regards, Sanjeev Kwatra
Advocate

Hi, if those professional editors or cameramen are engaged on a full-time basis, paid with a monthly salary, and have been contributing to the company for more than 5 years, then they are eligible for gratuity. Alternatively, if they are working on an assignment basis for a particular timeframe and not on a full-time work basis, and if they are paid a retainer fee, then they will not be eligible for gratuity as they are not considered employees as defined by the Gratuity Act.

Eligibility for Gratuity for Professional Editors and Cameramen

Gratuity is a benefit provided to employees in recognition of their long-term service to an organization. However, the eligibility for gratuity depends on the terms of employment, nature of engagement, and the applicability of the Payment of Gratuity Act, 1972.

In the case of professional editors and cameramen who are working as independent contractors or freelancers and receiving professional fees with TDS deducted under section 194J, their eligibility for gratuity can be different compared to regular employees. Here are some points to consider:

Employee Status

The Payment of Gratuity Act applies to employees who are considered "employees" as per the Act's definition. Generally, independent contractors or freelancers are not considered employees under this Act.

Contractual Engagement

If editors and cameramen are working as independent contractors under a specific contract or engagement, they might not be covered by the gratuity provisions, as they might not meet the criteria of being employees under the Act.

Nature of Work

The nature of work, control, and supervision exercised over the individuals can also influence whether they are considered employees or independent contractors.

Long-Term Engagement

While gratuity is typically associated with long-term service, the applicability of the Act to independent contractors is not well-defined. Gratuity is more commonly associated with traditional employment relationships.

Legal Consultation

If you are uncertain about the eligibility of specific individuals for gratuity, it's advisable to seek legal advice or consult with a labor law expert familiar with the local laws and regulations.

Contractual Arrangements

If the company wishes to provide similar benefits to long-term contractors, it can be done through contractual agreements, but this would not fall under the purview of the Gratuity Act.

In summary, the eligibility of professional editors and cameramen for gratuity depends on their employment status, contractual arrangements, and the specific legal and regulatory framework in your jurisdiction.

Hi Sanjeev, In your question about whether professional editors and cameramen are paid professional charges after the deduction of 10% TDS under section 194J, they are not considered employees for whom statutory provisions like ESI, PF, and bonus are applicable. They are not eligible for gratuity; however, considering their long-term services of 5 years or more, it will be the prerogative of the management to pay gratuity, but not according to the rules for employees.

Thanks