Eligibility for Gratuity Payment
I have a query regarding the gratuity payable by my last organization. In my last organization, I worked for 4 years, 11 months, and 23 days (just 1 week less than 5 years). I have asked the employer to release my gratuity as per the government regulations.
As far as I know, gratuity is payable to any employee who has had continuous employment for more than 4 years and 240 days. However, my organization has refused to release the payment, stating that I am not eligible.
I kindly request the senior HR and IR members to please respond. If I am eligible for gratuity, what are the steps/actions I should follow to inform my last organization to release my gratuity amount?
Thanks and Regards,
RP
From India, Vadodara
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I have a query regarding the gratuity payable by my last organization. In my last organization, I worked for 4 years, 11 months, and 23 days (just 1 week less than 5 years). I have asked the employer to release my gratuity as per the government regulations.
As far as I know, gratuity is payable to any employee who has had continuous employment for more than 4 years and 240 days. However, my organization has refused to release the payment, stating that I am not eligible.
I kindly request the senior HR and IR members to please respond. If I am eligible for gratuity, what are the steps/actions I should follow to inform my last organization to release my gratuity amount?
Thanks and Regards,
RP
From India, Vadodara
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Please ask your HR to read this post: [What is Gratuity - Understanding Taxes](http://www.investmentyogi.com/taxes/what-is-gratuity.aspx). You are indeed eligible for your gratuity claim. For the procedure to claim, the seniors would be the best to guide you further.
In my opinion, talk to your HR and ask why you are not eligible for gratuity. If HR states that you fall short of 1 week for 5 years, mention that you are aware that 4 years and 8 months are enough to be eligible. If there are any other issues, check if those could be resolved.
From India, Mumbai
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742In my opinion, talk to your HR and ask why you are not eligible for gratuity. If HR states that you fall short of 1 week for 5 years, mention that you are aware that 4 years and 8 months are enough to be eligible. If there are any other issues, check if those could be resolved.
From India, Mumbai
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Understanding Gratuity Eligibility
Please ask your HR to read this post: http://www.investmentyogi.com/taxes/...-gratuity.aspx. You are very much eligible for your gratuity claim. When it comes to the procedure to claim, seniors would be the best to guide you further.
In my opinion, talk to your HR and ask why you are not eligible for gratuity. If HR says that you fall short of 1 week for 5 years, you can mention that you are aware that 4.8 years are enough to be eligible. If there are any other issues, check if those could be resolved.
Regards
From India, Mumbai
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Please ask your HR to read this post: http://www.investmentyogi.com/taxes/...-gratuity.aspx. You are very much eligible for your gratuity claim. When it comes to the procedure to claim, seniors would be the best to guide you further.
In my opinion, talk to your HR and ask why you are not eligible for gratuity. If HR says that you fall short of 1 week for 5 years, you can mention that you are aware that 4.8 years are enough to be eligible. If there are any other issues, check if those could be resolved.
Regards
From India, Mumbai
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Thank you, Ankita, for your response. However, I have already done this. I have also sent them many high court case studies on similar issues and many legal documents mentioning the law. However, they are not agreeing to release the same. I would like to know how I should proceed further with legal steps.
Thank you,
Ronak
From India, Vadodara
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Thank you,
Ronak
From India, Vadodara
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I suggest you quote the high court judgement and send a letter to your organization before you go further on legal aid.
From India, Chennai
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From India, Chennai
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You can send a letter to the company with the SC's guidelines. You can lodge a complaint with 'The Competent Authority under the Gratuity Act' at the local Government Labor Office and attach a copy of that letter to the letter to the GLO.
From India, Pune
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From India, Pune
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You should send a written petition to the employer by speed post so that you will receive an acknowledgment. Wait for a few days for their reply, but if there is no response, then file a complaint with the commissioner under the Gratuity Act. The regional Labour Commissioner/Assistant Commissioner would be the designated authority.
Section: 9
Penalties for Non-Payment of Gratuity:
(1) Whoever, for the purpose of avoiding any payment to be made by himself under this Act or of enabling any other person to avoid such payment, knowingly makes or causes to be made any false statement or false representation shall be punishable with imprisonment for a term which may extend to six months, or with a fine which may extend to ten thousand rupees, or with both.
Regards,
Anita
From India, Mumbai
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Section: 9
Penalties for Non-Payment of Gratuity:
(1) Whoever, for the purpose of avoiding any payment to be made by himself under this Act or of enabling any other person to avoid such payment, knowingly makes or causes to be made any false statement or false representation shall be punishable with imprisonment for a term which may extend to six months, or with a fine which may extend to ten thousand rupees, or with both.
Regards,
Anita
From India, Mumbai
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In my opinion, you should resend Form I under the Gratuity Act via speed post to the employer. If the employer refuses payment, then you should approach the Controlling Authority, i.e., the Labour Court or the Labour Commissioner/Inspector, with proof of the acknowledgment copy of Form I that you had previously sent to the principal employer.
Thanks & Regards,
Yogesh Rathor
[Phone Number Removed For Privacy Reasons]
From India, Chandigarh
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Thanks & Regards,
Yogesh Rathor
[Phone Number Removed For Privacy Reasons]
From India, Chandigarh
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As discussed in the forum by some of our senior members, you may go ahead with the legal action. The following sections would benefit and strengthen your case further.
Section 8 of The Payment of Gratuity Act, 1972
This section talks about the recovery of gratuity from the employer. It states that "if the amount of gratuity payable under this Act is not paid by the employer, within the prescribed time, to the person entitled thereto, the controlling authority shall, on an application made to it in this behalf by the aggrieved person, issue a certificate for that amount to the Collector, who shall recover the same, together with compound interest thereon at such rate as the Central Government may, by notification, specify from the date of expiry of the prescribed time, as arrears of land revenue and pay the same to the person entitled thereto. Provided that the controlling authority shall, before issuing a certificate under this section, give the employer a reasonable opportunity of showing cause against the issue of such certificate: Provided further that the amount of interest payable under this section shall, in no case, exceed the amount of gratuity payable under this Act."
Section 3 of the Act
This section talks about the controlling authority, stating that "the appropriate Government may, by notification, appoint any officer to be a controlling authority, who shall be responsible for the administration of this Act and different controlling authorities may be appointed for different areas."
Sub-section (1) of Section 4
This sub-section talks about the eligibility period of gratuity, stating that gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years:
- (a) On his superannuation, or
- (b) On his retirement or resignation, or
- (c) On his death or disablement due to accident or disease.
Section 2A - "Continuous Service"
Sub-section (1) states that an employee shall be said to be in continuous service for a period if he has, for that period, been in uninterrupted service, including service which may be interrupted on account of sickness, accident, leave, absence from duty without leave (not being absence in respect of which an order treating the absence as a break in service has been passed in accordance with the standing orders, rules, or regulations governing the employees of the establishment), lay-off, strike, or a lock-out or cessation of work not due to any fault of the employee, whether such uninterrupted or interrupted service was rendered before or after the commencement of this Act.
Subsection (2) further clarifies: "Where an employee (not being an employee employed in a seasonal establishment) is not in continuous service within the meaning of clause (1), for any period of one year or six months, he shall be deemed to be in continuous service under the employer:
- (a) For the said period of one year, if the employee during the period of twelve calendar months preceding the date with reference to which calculation is to be made, has actually worked under the employer for not less than:
- (i) One hundred and ninety days, in the case of an employee employed below the ground in a mine or in an establishment which works for less than six days in a week; and
- (ii) Two hundred and forty days, in any other case.
Regards
From India
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Section 8 of The Payment of Gratuity Act, 1972
This section talks about the recovery of gratuity from the employer. It states that "if the amount of gratuity payable under this Act is not paid by the employer, within the prescribed time, to the person entitled thereto, the controlling authority shall, on an application made to it in this behalf by the aggrieved person, issue a certificate for that amount to the Collector, who shall recover the same, together with compound interest thereon at such rate as the Central Government may, by notification, specify from the date of expiry of the prescribed time, as arrears of land revenue and pay the same to the person entitled thereto. Provided that the controlling authority shall, before issuing a certificate under this section, give the employer a reasonable opportunity of showing cause against the issue of such certificate: Provided further that the amount of interest payable under this section shall, in no case, exceed the amount of gratuity payable under this Act."
Section 3 of the Act
This section talks about the controlling authority, stating that "the appropriate Government may, by notification, appoint any officer to be a controlling authority, who shall be responsible for the administration of this Act and different controlling authorities may be appointed for different areas."
Sub-section (1) of Section 4
This sub-section talks about the eligibility period of gratuity, stating that gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years:
- (a) On his superannuation, or
- (b) On his retirement or resignation, or
- (c) On his death or disablement due to accident or disease.
Section 2A - "Continuous Service"
Sub-section (1) states that an employee shall be said to be in continuous service for a period if he has, for that period, been in uninterrupted service, including service which may be interrupted on account of sickness, accident, leave, absence from duty without leave (not being absence in respect of which an order treating the absence as a break in service has been passed in accordance with the standing orders, rules, or regulations governing the employees of the establishment), lay-off, strike, or a lock-out or cessation of work not due to any fault of the employee, whether such uninterrupted or interrupted service was rendered before or after the commencement of this Act.
Subsection (2) further clarifies: "Where an employee (not being an employee employed in a seasonal establishment) is not in continuous service within the meaning of clause (1), for any period of one year or six months, he shall be deemed to be in continuous service under the employer:
- (a) For the said period of one year, if the employee during the period of twelve calendar months preceding the date with reference to which calculation is to be made, has actually worked under the employer for not less than:
- (i) One hundred and ninety days, in the case of an employee employed below the ground in a mine or in an establishment which works for less than six days in a week; and
- (ii) Two hundred and forty days, in any other case.
Regards
From India
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Steps to Claim Gratuity
1. Send a requisition letter to the concerned authority of the organization, stating your date of joining and leaving, and request the amount of gratuity.
2. Send a reminder letter after 15 days, clarifying that it serves as a notice.
3. Approach the Controlling Authority under the Payment of Gratuity Act, 1972, by submitting the required form and related details.
4. Appear before the Controlling Authority. There are enough case citations in favor.
Regards
From India, Pondicherry
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1. Send a requisition letter to the concerned authority of the organization, stating your date of joining and leaving, and request the amount of gratuity.
2. Send a reminder letter after 15 days, clarifying that it serves as a notice.
3. Approach the Controlling Authority under the Payment of Gratuity Act, 1972, by submitting the required form and related details.
4. Appear before the Controlling Authority. There are enough case citations in favor.
Regards
From India, Pondicherry
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You will not be eligible for gratuity because 5 years of service is compulsory. You cannot treat it as 4.8 as a count. For example, if a girl's age is 17.8 (17 years and 8 months), she will not be treated as 18 and can get married; it must be a complete 18 years of age.
Thank you.
From India, Ahmadabad
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Thank you.
From India, Ahmadabad
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Mr. Mukesh,
I do not understand the relevance of comparing an age of 17.8 years with 4.8 years for gratuity qualification.
Anyway, here I present my data from a lawyer's site:
"Judgment from Supreme Court:
Yes, by virtue of the judgment of the Supreme Court rendered under the provisions of the Industrial Dispute Act in Surendra Kumar Verma vs. Central Govt. Industrial Tribunal, [(1980) (4) S.C.C.433)], it is enough that an employee has a service of 240 days in the preceding 12 months, and it is not necessary that he should have completed one whole year's service. As the definition of continuous service in the Industrial Dispute Act and Payment of Gratuity Act are synonymous, the same principle can be adopted under the act also. Hence, an employee rendering service of 4 years, 10 months, and 11 days is considered to have completed 5 years of continuous service under sec.4(2) and thereby is eligible for gratuity."
An employee who has put in his service for a period of 240 days in the fifth year will be deemed to have continued in the service for 1 year.
Mettus Beardsell Ltd., Madras Vs. RLC(C) 1998 LLR 1072(Mad)
For further clarifications, you can follow the link: Clarity between gratuity eligibility service (5 or 4.8 yrs)? - Labour & Service Law Forum - Law, Lawyers, Advocates, Law Firms, Legal Help, Legal Experts, Judgements, Law Help, Indian Lawyers
Hope that clarifies the doubt that any person who has worked a minimum period of 4 years and 240 days is eligible for the gratuity amount.
Regards.
From India, Mumbai
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I do not understand the relevance of comparing an age of 17.8 years with 4.8 years for gratuity qualification.
Anyway, here I present my data from a lawyer's site:
"Judgment from Supreme Court:
Yes, by virtue of the judgment of the Supreme Court rendered under the provisions of the Industrial Dispute Act in Surendra Kumar Verma vs. Central Govt. Industrial Tribunal, [(1980) (4) S.C.C.433)], it is enough that an employee has a service of 240 days in the preceding 12 months, and it is not necessary that he should have completed one whole year's service. As the definition of continuous service in the Industrial Dispute Act and Payment of Gratuity Act are synonymous, the same principle can be adopted under the act also. Hence, an employee rendering service of 4 years, 10 months, and 11 days is considered to have completed 5 years of continuous service under sec.4(2) and thereby is eligible for gratuity."
An employee who has put in his service for a period of 240 days in the fifth year will be deemed to have continued in the service for 1 year.
Mettus Beardsell Ltd., Madras Vs. RLC(C) 1998 LLR 1072(Mad)
For further clarifications, you can follow the link: Clarity between gratuity eligibility service (5 or 4.8 yrs)? - Labour & Service Law Forum - Law, Lawyers, Advocates, Law Firms, Legal Help, Legal Experts, Judgements, Law Help, Indian Lawyers
Hope that clarifies the doubt that any person who has worked a minimum period of 4 years and 240 days is eligible for the gratuity amount.
Regards.
From India, Mumbai
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Dear All,
I worked with a Hyderabad-based Healthcare IT industry (KPO) company for 8 years and was relieved on the 31st of March '19. Till now, I have not received my gratuity (my last basic salary was 17,800), and I received a relieving letter for this period. HR said they would credit my gratuity to my account directly after a month, but it has not happened. Now, two months have passed, and there has been no response to emails, calls, or messages from HR. I suspect they are trying to refuse my gratuity.
Finally, I have decided to pursue legal action. Please advise me on how to file a case against my employer. My query is to provide me with any hints to take necessary action.
Regards,
Pratap Reddy
From India, Hyderabad
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I worked with a Hyderabad-based Healthcare IT industry (KPO) company for 8 years and was relieved on the 31st of March '19. Till now, I have not received my gratuity (my last basic salary was 17,800), and I received a relieving letter for this period. HR said they would credit my gratuity to my account directly after a month, but it has not happened. Now, two months have passed, and there has been no response to emails, calls, or messages from HR. I suspect they are trying to refuse my gratuity.
Finally, I have decided to pursue legal action. Please advise me on how to file a case against my employer. My query is to provide me with any hints to take necessary action.
Regards,
Pratap Reddy
From India, Hyderabad
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Hi,
At the time of relieving, have you made a request in writing to your employer? Whether yes or no, please send a request letter again. The employer has to settle gratuity within 30 days from the date of relieving. However, some companies take time to settle. In case of no response from the employer, call your HR and find out. As a last measure, you can file the case with the Assistant Commissioner of Labour of your jurisdiction. This is as per the Act.
From India, Madras
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At the time of relieving, have you made a request in writing to your employer? Whether yes or no, please send a request letter again. The employer has to settle gratuity within 30 days from the date of relieving. However, some companies take time to settle. In case of no response from the employer, call your HR and find out. As a last measure, you can file the case with the Assistant Commissioner of Labour of your jurisdiction. This is as per the Act.
From India, Madras
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Form for memorandun of sellement of industrial dispute between employer and employees.doc
Gratuity form I claim.pdf