The employees of the organized sector can now be allowed to withdraw up to Rs 20 lakh from their gratuity fund.
In a meeting between the labor ministry and representatives from states, employees, and employers, the decision was reached to a consensus.
The central trade unions have also agreed to double the gratuity amount ceiling as an interim measure in a tripartite meeting on the proposed amendment to the Payment of Gratuity Act conducted today by the Labor Ministry. The unions demanded the removal of conditions asking to have at least 10 employees in an establishment and a minimum of five years of service for the payment of gratuity.
Currently, as per the Payment of Gratuity Act, an employee is required to have a minimum service of five years to become eligible for the gratuity amount.
Furthermore, the Act applies to those establishments where the number of employees is not less than 10.
The statement said the application of amended provisions regarding the maximum amount should be made effective from January 1, 2016, as done in the case of central government employees.
In addition, the rate of 15 days' wages for each completed year of service should be raised to 30 days' wages, as demanded by the unions.
The proposed amendment to the Payment of Gratuity Act, as circulated by the government along with the letter dated February 15, 2017, only deals with enhancing the ceiling of the maximum amount under Section 4(3) of the Act from Rs 10 lakh to Rs 20 lakh.
From India, Ahmadabad
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34In a meeting between the labor ministry and representatives from states, employees, and employers, the decision was reached to a consensus.
The central trade unions have also agreed to double the gratuity amount ceiling as an interim measure in a tripartite meeting on the proposed amendment to the Payment of Gratuity Act conducted today by the Labor Ministry. The unions demanded the removal of conditions asking to have at least 10 employees in an establishment and a minimum of five years of service for the payment of gratuity.
Currently, as per the Payment of Gratuity Act, an employee is required to have a minimum service of five years to become eligible for the gratuity amount.
Furthermore, the Act applies to those establishments where the number of employees is not less than 10.
The statement said the application of amended provisions regarding the maximum amount should be made effective from January 1, 2016, as done in the case of central government employees.
In addition, the rate of 15 days' wages for each completed year of service should be raised to 30 days' wages, as demanded by the unions.
The proposed amendment to the Payment of Gratuity Act, as circulated by the government along with the letter dated February 15, 2017, only deals with enhancing the ceiling of the maximum amount under Section 4(3) of the Act from Rs 10 lakh to Rs 20 lakh.
From India, Ahmadabad
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Payment of Gratuity Amendment Bill 2010.pdf