Dear Seniors,
Kindly guide me.
We are having our office in NCR. One of the employee left after working for 5 years 1 month. As per the law, we provided him gratuity as per the company's standard salary structure in his full and final settlement. But he is not agree with that gratuity as he told at the time of joining no ctc breakup was given to him. Upon discussion with management, we told him that although salary breakup was not given but as per the company's structure, Form 16 has been provided to you each year clearly mentioning HRA & transport allowance. Now he is rigid that the balance salary which was shown in Form 16 is supposed to be basic & the amount of gratuity should be paid to him on that. His salary was paid by account transfer. Kindly guide me being the HR Head how should I tackle this? He is threatening to go in court.
Regards,
D Singh
From India, Delhi
2Kindly guide me.
We are having our office in NCR. One of the employee left after working for 5 years 1 month. As per the law, we provided him gratuity as per the company's standard salary structure in his full and final settlement. But he is not agree with that gratuity as he told at the time of joining no ctc breakup was given to him. Upon discussion with management, we told him that although salary breakup was not given but as per the company's structure, Form 16 has been provided to you each year clearly mentioning HRA & transport allowance. Now he is rigid that the balance salary which was shown in Form 16 is supposed to be basic & the amount of gratuity should be paid to him on that. His salary was paid by account transfer. Kindly guide me being the HR Head how should I tackle this? He is threatening to go in court.
Regards,
D Singh
From India, Delhi
What was his role in your Company? Did you issue Appointment letter to him? If possible, please reproduce the clause of "Remuneration- shown in the Appointment letter. Thanks, R K Nair
From India, Aizawl
From India, Aizawl
Salary:
Dear Mr. Nair,
Thanks for reply.
We have issued him appointment letter & the slary clause is stated as under:
He was Executive Assistant to M.D.
Your gross Salary (CTC) is Rs ------------------------/pm. If any statutory deduction or contribution like PF, ESI etc on behalf of the Company is required by any concerned authority, it shall be accommodated from your gross salary (CTC). Your salary structure/payments shall be governed by the rules and regulations of the company. Salary is a confidential matter and cannot be disclosed or discussed with anyone internally or externally except MD & Chairman or HR Dept.
Confidentiality of Salary Information:
Your Salary package is based on, besides your overall experience level in the Industry, your educational qualifications and the experience and knowledge level assessed at the time of selection, particularly in the skill sets relevant. Therefore, the Salary package offered to you is peculiar and personal to you. Salary increase or adjustment is not automatic but depends upon your individual performance as well as your group performance, if any. Salary is a confidential matter and cannot be disclosed or discussed with anyone internally or externally except MD & Chairman or HR Dept.
Kindly guide me.
Daisy Singh
From India, Delhi
Dear Mr. Nair,
Thanks for reply.
We have issued him appointment letter & the slary clause is stated as under:
He was Executive Assistant to M.D.
Your gross Salary (CTC) is Rs ------------------------/pm. If any statutory deduction or contribution like PF, ESI etc on behalf of the Company is required by any concerned authority, it shall be accommodated from your gross salary (CTC). Your salary structure/payments shall be governed by the rules and regulations of the company. Salary is a confidential matter and cannot be disclosed or discussed with anyone internally or externally except MD & Chairman or HR Dept.
Confidentiality of Salary Information:
Your Salary package is based on, besides your overall experience level in the Industry, your educational qualifications and the experience and knowledge level assessed at the time of selection, particularly in the skill sets relevant. Therefore, the Salary package offered to you is peculiar and personal to you. Salary increase or adjustment is not automatic but depends upon your individual performance as well as your group performance, if any. Salary is a confidential matter and cannot be disclosed or discussed with anyone internally or externally except MD & Chairman or HR Dept.
Kindly guide me.
Daisy Singh
From India, Delhi
Dear Daily, Please confirm all earning components which you used in your company while paying to the employee. Are there any deductions like PF, ESIC, PT, etc... Regards, Janardan
From India, Mumbai
From India, Mumbai
Dear Janardan Raccha, No , we have never made any deductions in any fund for him. Daisy
From India, Delhi
From India, Delhi
If the aggrieved employee goes to Court of Law, it can pose a threat to your company,
as you have not made any deductions to any fund.
Then how could you issue Form-16 showing his earnings & deductions?.
Am afraid, you have to ultimately agree to his argument.
Thanks
R K Nair
From India, Aizawl
as you have not made any deductions to any fund.
Then how could you issue Form-16 showing his earnings & deductions?.
Am afraid, you have to ultimately agree to his argument.
Thanks
R K Nair
From India, Aizawl
Dear Daisy,
I would like to inform you that the concept of CTC & Gross are different, Gross is nothing but all earning & deduction whereas CTC is the combination of fixed and variable components in which earnings, deductions and performance linked incentives have been clubbed together and form a total cost which we called as cost to company.
We must know the basic amount for calculating gratuity which is missing in this case. Because of which it is difficult to justify the eligibility and applicability of payment of gratuity to the employee.
Regards,
Janardan
From India, Mumbai
I would like to inform you that the concept of CTC & Gross are different, Gross is nothing but all earning & deduction whereas CTC is the combination of fixed and variable components in which earnings, deductions and performance linked incentives have been clubbed together and form a total cost which we called as cost to company.
We must know the basic amount for calculating gratuity which is missing in this case. Because of which it is difficult to justify the eligibility and applicability of payment of gratuity to the employee.
Regards,
Janardan
From India, Mumbai
Hi,
The basic is 6500/- upon which the company is calculating gratuity. Whereas his take home was 48,348/- per month.Now the thing is in form 16 issued to him last year by the company has mentioned as below:
Salary as per provisions contained in Sec(17)1 is 3,74,684
Travel Allowance Rs. 6000/-
Transport - Rs,9600/-
Now he is saying that the balance salary i;e (paid against Sec(17)1 is - Travel& Transport) is his basic and he is entitled gratuity on that amount.
Plz. reply.
From India, Delhi
The basic is 6500/- upon which the company is calculating gratuity. Whereas his take home was 48,348/- per month.Now the thing is in form 16 issued to him last year by the company has mentioned as below:
Salary as per provisions contained in Sec(17)1 is 3,74,684
Travel Allowance Rs. 6000/-
Transport - Rs,9600/-
Now he is saying that the balance salary i;e (paid against Sec(17)1 is - Travel& Transport) is his basic and he is entitled gratuity on that amount.
Plz. reply.
From India, Delhi
Daisy,
The difference between take home salary and basic so fixed is having huge difference and moreover the clause of appointment letter also do not disclose the proper bifurcation of his salary package into certain allowances. It seems that your establishment may also not have taken his signatures on the pay roll and pay slips which contains each and every details of his salary breakup, earnings, leaves, deductions and net payable which may prove that he was aware of the salary structure.
And if so, then he can file a application to the Controlling Authority under the provisions of the Act.
P K Sharma
From India, Delhi
The difference between take home salary and basic so fixed is having huge difference and moreover the clause of appointment letter also do not disclose the proper bifurcation of his salary package into certain allowances. It seems that your establishment may also not have taken his signatures on the pay roll and pay slips which contains each and every details of his salary breakup, earnings, leaves, deductions and net payable which may prove that he was aware of the salary structure.
And if so, then he can file a application to the Controlling Authority under the provisions of the Act.
P K Sharma
From India, Delhi
I strongly agree with P K Sharma, did you gave any payslip or salary statement so that you can prove that the employee is aware of the Breakup of his/her salary. If not then the employee is correct and can file an application to the controlling authority for Gratuity Calculation mismatch
From India, Ahmadabad
From India, Ahmadabad
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FORM-F-NOMINATI ON OF GRATUITY.pdf
Gratuity Form I.doc