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Anonymous
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Hello seniors, we are a manufacturing unit located near Baroda, Gujarat. Previously, there was no HR in this unit, so there is no established HR system here.

Gratuity Calculation

I would appreciate your guidance on the following case: One employee has been working in our organization for 7 years. He is now leaving the organization with a one-month notice period and is requesting gratuity. His basic salary is Rs. 9000 CTC, with a basic of Rs. 5000. How much will the gratuity amount be?

Convincing Directors to Pay Gratuity

Additionally, the directors of my organization do not want to pay the gratuity amount. How can I convince them to pay the gratuity amount?

Thanks in advance!

From India, Vadodara
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Dear Mr. Anamika,

From your post, it appears you are new to this profession. Please clarify, "His basic salary is Rs. 9000 CTC, where the basic is Rs. 5000/-." Even after being in the service, the salary is Rs. 9,000/-. Please note that Gratuity is payable on Basic+DA+VDA on par with Minimum Wages applicable to your industry. I recommend going through the Payment of Gratuity Act and the Minimum Wages Act/notification before you take up the matter with your Directors.

From India, New Delhi
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Amount of Gratuity payable is Rs 20,192/-. Basic-5000/26 X 15 Days X 7 Years - Rs 20,192/-

Please collect the Gratuity claim application from the employee and pay within 1 month from the date of leaving service by cheque. Send the details to the controlling authority, i.e., ALC.

From India, New Delhi
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Calculations are already explained. If you are a company with 10 or more employees, then the act becomes applicable to you. You can display the Act applicability clause under the Act and share the URL with them to inform the management that the act is applicable to you. If you refuse to pay even if the act is applicable, eligible employees may approach the Labour Office, which will mean inviting trouble. You should inform the management accordingly.
From India, Mumbai
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NM
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