Clarification on Gratuity Eligibility
I need clarification on gratuity for this case. An employee joined the company on 1st October 2008 and resigned, with the company relieving him from duties on 31st August 2013. The employee worked in the organization for 4 years and 11 months (Continued Service).
The company's head office is located in Mumbai, but they have established their factory in Tamilnadu. The factory is registered under the Factories Act in Tamilnadu.
Questions:
1. Is the employee eligible for gratuity or not?
2. Does the company have to follow the Tamilnadu gratuity rules or not?
3. According to the Gratuity Act, we have to consider it as continued service if an employee worked 240 days in the respective year. So why can't we consider it as continued service in the fifth year if the employee worked 240 days?
Now, the company states that as per the central gratuity rules, the employee has not completed the required years of service, so he can't be deemed eligible for gratuity as per the rules.
Note: A judgment was given by the Madras High Court: Mettur Beardsell Ltd Vs Regional Labour Commissioner, Madras High Court, 1998, as you are aware.
Kindly provide any recent judgments on this by any courts.
Regards,
MAS-Hr
From India, Erode
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I need clarification on gratuity for this case. An employee joined the company on 1st October 2008 and resigned, with the company relieving him from duties on 31st August 2013. The employee worked in the organization for 4 years and 11 months (Continued Service).
The company's head office is located in Mumbai, but they have established their factory in Tamilnadu. The factory is registered under the Factories Act in Tamilnadu.
Questions:
1. Is the employee eligible for gratuity or not?
2. Does the company have to follow the Tamilnadu gratuity rules or not?
3. According to the Gratuity Act, we have to consider it as continued service if an employee worked 240 days in the respective year. So why can't we consider it as continued service in the fifth year if the employee worked 240 days?
Now, the company states that as per the central gratuity rules, the employee has not completed the required years of service, so he can't be deemed eligible for gratuity as per the rules.
Note: A judgment was given by the Madras High Court: Mettur Beardsell Ltd Vs Regional Labour Commissioner, Madras High Court, 1998, as you are aware.
Kindly provide any recent judgments on this by any courts.
Regards,
MAS-Hr
From India, Erode
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According to the Gratuity Act, gratuity is payable to any employee after five continuous years of service. Therefore, according to the act, the candidate is not eligible for gratuity. However, if we consider the Madras High Court judgment, then he is eligible for gratuity. This presents a debate between the court and the act, according to experts.
From India, Mumbai
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6From India, Mumbai
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Your factory is located in Tamil Nadu, so all the rules and regulations that will be applicable are as per the state government and not the central government. Therefore, the employee will not be eligible to receive gratuity as per the act. If the employee had completed 5.5 years, then they would have been eligible for a total of 6 years of gratuity.
Regards,
Ravindra Kumar Gupta
Asst. HR Manager
[Phone Number Removed For Privacy Reasons]
From India, Mumbai
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Regards,
Ravindra Kumar Gupta
Asst. HR Manager
[Phone Number Removed For Privacy Reasons]
From India, Mumbai
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Dear Ravindra Kumar, Thanks for your reply, Madras high court has given judgment for gratuity as 4 Yrs 240 days eligible for gratuity. Attached notification for your reference. Thanks.
From India, Erode
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From India, Erode
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Dear Seniors, I think if a person completes 240 days in a year, their continuous service is considered one year, as clarified in the act. Therefore, when a person completes 240 days in the 5th year, they are eligible for gratuity.
Thanks,
Amar Singh
From India, Delhi
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Thanks,
Amar Singh
From India, Delhi
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Dear Friend, he completed 4 yrs 11 m continuous service. Since his service is more than 4 yrs 6 months his period should be considered as 5 yrs and gratuity must be given to him.
From United States, Chicago
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From United States, Chicago
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He will be eligible for gratuity in this case as per the Madras High Court judgment. I also found a nice article on various other employee benefits in India - [Employee Benefits by Companies in India - InvestmentYogi](http://www.investmentyogi.com/employee-benefits-by-companies-in-india/).
From India, Hyderabad
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From India, Hyderabad
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The employee has joined the factory or its Head Office. If the employee is working with the factory in Tamil Nadu, he/she is eligible for gratuity. Kindly consult a lawyer who will help you in this regard.
From India, Ahmadabad
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From India, Ahmadabad
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Dear All,
Can anyone please provide me with a copy of the Act where it is clearly mentioned that on completion of 4 years and 240 days, an employee is eligible to claim Gratuity? Still, this point is not clear as, in the absence of proper documentation, employers are not ready to pay it until and unless the employee has completed 5 years.
Thanks,
Deepa
From India, Madras
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Can anyone please provide me with a copy of the Act where it is clearly mentioned that on completion of 4 years and 240 days, an employee is eligible to claim Gratuity? Still, this point is not clear as, in the absence of proper documentation, employers are not ready to pay it until and unless the employee has completed 5 years.
Thanks,
Deepa
From India, Madras
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Madras High Court Judgment - Gratuity.pdf