Hi, I am an MBA student doing a study on compensation components. I wish to know what is superannuation and what is gratuity. Pls help Jenny
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Dear Jenny,
To my knowledge, Superannuation is a contract between an employer and an employee. When the period of service mentioned is over, you say that on account of superannuation, he left the company.
Gratuity: This is a payment made to an employee for his continuous service of 5 years. He will be paid a certain amount which will be calculated based on his/her basic pay multiplied by the number of years of service multiplied by 15/26.
Anyway, please cross-check the same.
Regards, N. Neelam
From India, Madras
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To my knowledge, Superannuation is a contract between an employer and an employee. When the period of service mentioned is over, you say that on account of superannuation, he left the company.
Gratuity: This is a payment made to an employee for his continuous service of 5 years. He will be paid a certain amount which will be calculated based on his/her basic pay multiplied by the number of years of service multiplied by 15/26.
Anyway, please cross-check the same.
Regards, N. Neelam
From India, Madras
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Hello, as I know, superannuation refers to a retirement savings scheme or pension plan that is typically mandated by law in many countries. It is designed to help individuals accumulate funds for their retirement. Both employers and employees contribute a percentage of the employee's salary to a superannuation fund, which is then invested over time to grow the retirement savings. The accumulated funds in the superannuation account can be accessed by the employee upon reaching a certain age, usually referred to as the "preservation age," or meeting specific conditions such as permanent disability or severe financial hardship (uno online). The purpose of superannuation is to provide individuals with a source of income during their retirement years.
Meanwhile, Gratuity is a lump sum payment made by an employer to an employee as a token of appreciation or recognition for their long-term service when they retire, resign, or complete a certain number of years in employment. Gratuity is typically calculated based on the employee's length of service and their last drawn salary. The specific guidelines for calculating gratuity can vary between countries and may be governed by labor laws or employment contracts. Gratuity is usually tax-free up to a certain limit, beyond which it may be subject to taxation.
From Cook Islands, Avarua
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Meanwhile, Gratuity is a lump sum payment made by an employer to an employee as a token of appreciation or recognition for their long-term service when they retire, resign, or complete a certain number of years in employment. Gratuity is typically calculated based on the employee's length of service and their last drawn salary. The specific guidelines for calculating gratuity can vary between countries and may be governed by labor laws or employment contracts. Gratuity is usually tax-free up to a certain limit, beyond which it may be subject to taxation.
From Cook Islands, Avarua
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Published_draft _rules_on Employees_ compensation 3.6.2020.pdf
Gratuity Form I.doc