Dear all,
Let us discuss an interesting case here. A company had appointed an MD on a fixed-term contract for 4 years and further extended it for another 3 years. In the agreement clause for gratuity payment, it was mentioned as 4.15%. The company again renewed the contract for two more years, and the gratuity clause mentioned 2 months of the basic rate. Now, the question is whether the employee should be paid gratuity as per the agreement or as per the gratuity rules, i.e., continuous service for 9 years and the average salary of the last one year?
Thank you.
From India, Hyderabad
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Let us discuss an interesting case here. A company had appointed an MD on a fixed-term contract for 4 years and further extended it for another 3 years. In the agreement clause for gratuity payment, it was mentioned as 4.15%. The company again renewed the contract for two more years, and the gratuity clause mentioned 2 months of the basic rate. Now, the question is whether the employee should be paid gratuity as per the agreement or as per the gratuity rules, i.e., continuous service for 9 years and the average salary of the last one year?
Thank you.
From India, Hyderabad
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Gratuity will have to be paid as per Payment of Gratuity Act. One cannot contract to pay lesser than legal entitlement-where it is specified how gratuity is to be worked out.
From India, Pune
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3180From India, Pune
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Payment of Gratuity Act, 1972 & The Rules.ppt
THE PAYMENT OF GRATUITY ACT 1972.doc