Gratuity for 4 yrs 11 months, and 5 days - Any pointers to law books or legal docs supporting my case?

Hello, I have completed 4 years and 11 months and 5 days in my previous job. In all likelihood, I have completed 240 days in my 5th year. Am I eligible for gratuity? I contacted my ex-employer, and the finance team said they are evaluating the case. Please advise. Any pointers to law books or legal docs supporting my case are greatly appreciated.

Thank you

Hi,

Any employee who has completed 4 years and 8 months (or 4 years and 240 days in the 5th year) of service is eligible for gratuity as per the Payment of Gratuity Act, 1972.

An employee is eligible for gratuity only if he has 240 days of continuous service in each completed year for 5 years.

Please let me know if you need any further assistance.

As per the Gratuity Act, any employee who has not completed their five years of continuous service will not be eligible for gratuity, even if they have completed four years and eleven months. Therefore, Anu will not be eligible for gratuity.

Mr. Coolheadtamil is correct. You are required to complete 240 days in a year. Therefore, for the fifth year, if you have already completed your 240 days (though in 11 months), you will be eligible for gratuity.

Mayuri Manager - HR

Hello Anuaro,

Please find the attachment for your clarification.

Regards,
Rohan Bhatt.

I do agree with Rath Ratikanta. As per the Gratuity Act, any employee who has not completed their 5 years of continuous service will not be eligible for gratuity.

Thank you.

Hi,

It is clarified here that as per the Gratuity Act, any employee who has not completed his continuous 5 years of service in an establishment will not be eligible for receiving the gratuity amount, even if he has completed 4 years and 11 months of service. The 240-day clause is mentioned in the Act for the purpose of calculating Gratuity. That is, if the person is entitled to gratuity and in the sixth year he has completed 240 days of continuous service, then he will be entitled to the whole year's gratuity in the sixth year. To be entitled to the gratuity amount, one must complete 5 years of service in an establishment. Therefore, you are not eligible to receive the gratuity amount.

V.K. Gupta

Dear Friends,

The Madras High Court judgment has been regarded by HR professionals as the final word on the matter of gratuity payment before completing five years of continuous service. It has been interpreted as having legal binding nationwide. For the benefit of all, I believe it is necessary to clarify the situation.

The Madras High Court judgment holds legal binding only in the state of Tamil Nadu. In other states, it carries persuasive value but not legal binding.

There has been no decision from the Supreme Court on this issue. Until such a judgment is made by the highest court in the country, the provisions of the Gratuity Act will always take precedence. The Act specifies that gratuity eligibility is only after completing five years of continuous service. The calculation of gratuity should consider 240 days in each year.

The exception to the five-year service requirement is only in cases of death or disablement.

Regards,

Anil Kaushik

Chief Editor-Business Manager-HR magazine

B-138, Ambedkar Nagar, Alwar-301001 (Raj.) India

Email: bmalwar@yahoo.com

Mobile: 09829133699

For the payment of gratuity, one should complete a minimum of 5 years of service as per the Payment of Gratuity Act.

Regards,
Arjun Singh

Hi,

I disagree with Mr. Gupta. According to the amendment act, whoever completes 4 years and 240 days is eligible for gratuity. I believe the same subject was discussed around 6 months back, and we all clarified this. I am herewith enclosing the amendment act for your reference.

Pradeepan

Dear Anurao,

As per Sec. 2A of the Act, if you have attended for 240 days for the purpose of "continuous service," you are perfectly eligible for gratuity. You can claim gratuity from your employer.

Regards

Dear all,

Regarding gratuity, when you are going to pay gratuity, please consider two things first:
a) Eligibility
b) Calculation

As far as eligibility, the first 5 years must be completely completed. The act never mentions rounding up to the nearest for the first 5 years.

Regarding calculation, the act states to round up to the nearest.

Conclusion - Anu is not eligible for gratuity.

Thanks

There were some misunderstandings due to one verdict from the Supreme Court and another one from the Madras High Court stating that if there is an attendance of 240 days in the last year, it will be considered as a full year.

When I conducted a detailed study, to my knowledge, after the above judgments, the act has been amended as follows:

1. The minimum eligibility to receive Gratuity is 5 years.
2. In the case of permanent employees, for the preceding 12 months, there should be a minimum attendance of:
a) 190 days
i) for those who work in Mines
ii) for those who work for less than 6 days in a week
b) 240 days in other cases.

In other words, 240 days is the minimum attendance required in a 12-month period.

Abbas.P.S

The basic condition for the eligibility of gratuity is to complete 5 years. The rule of 6 months or more will apply for the calculation of gratuity but not for eligibility, so you are not eligible for gratuity.

Nagaraj

I am based in Bangalore. I haven't heard from my ex-employer yet about my eligibility. I have collected a mixture of opinions in this forum. :-) I am in a dilemma now.

I will confirm what happens when my ex-employer updates me!

Thank you
Anu

Dear V.K. Gupta & Anil Kaushik,

Regarding the calculation of Gratuity, a fraction of more than 6 months will be rounded up to the next full year. For this purpose, 240 days are not required.

Abbas.P.S

Dear Anurao,

May I request you to please immediately file a claim with your former employer for payment of gratuity for services rendered by you for 4 years, 11 months, and 11 days. The Payment of Gratuity Act, 1972, is very clear that one has to complete a minimum of 5 years of service to become eligible for payment of gratuity. For those who could not complete this provision of 5 years, there are explanations/provisions that the period over and above 6 months is to be rounded off to the next full year. The law has sanctity. So have the provisos and explanations too. For getting the benefits in actual, you have to file the claim for gratuity. Unless you file the claim for gratuity, the employer is not legally bound to give an explanation or pay the gratuity. Once you lodge the claim, the administrative machinery will start functioning and either pay you gratuity or repudiate your claim.

If the claim is repudiated, the employer will give you an explanation for his action. We can then discuss the matter in this forum. So please file the claim and intimate us of the final result. Lodge a claim for gratuity of a full year of service stating that the period of 11 months and 10 days has been rounded off to the next full year, totaling five years of service. Ensure that you did not have 'leave without pay' during this period, which is not considered as qualified service. Here is also one more explanation/proviso. Leave without pay on medical grounds is considered qualified service. The most important factor is your gratuity claim filed with the employer in the prescribed form. In the absence of your claim, your eligibility is not sufficient for the payment of gratuity. When you receive the gratuity, please do remember to inform us on this forum. Thanks and regards,

Shyam Agrawal

Hi Everyone,

In relation to this thread, kindly clarify the below doubts. Is the gratuity amount to be considered under CTC? Can we reflect the same in the salary slip or detailed salary break-up annexure?

Thanks,
Kevina

Dear Mr. Pradeepan,

There is no amendment to the act in this regard. It is only a Madras High Court judgment. There is no case law from the Apex Court. It may be applicable only to the TN State but not to other states. As per the act, 5 years of service are a must.

Regards,
Prasad SBR

Hello Mr. Shyam Agrawal,

My company wants more time to decide on my eligibility. When I got back to them about an estimated time, they are not ready to commit to any timeline. My PF was credited only last month (it's 8 months since I quit). Now I am not sure if there is a timeline within which the company should pay or I should claim. Please advise as to where I need to claim the amount? My Employer or deputy commissioner of labor authority?

Any tips are greatly appreciated.

Thank you,
Anu

Dear Anurao,

Gratuity is payable to you by your former employer. Therefore, please lodge a claim with your former employer for the payment of gratuity in the prescribed form, which you can find in the printed book of the Payment of Gratuity Act, 1972. You can also download it from the website. If you cannot lay hands on it, please revert to me. My personal email ID is shyaam.agrawal@gmail.com. You may make use of this ID and contact me. The time limit for the payment of gratuity by the former employer is 30 days from the date of receipt of the application from the former employee. Luckily, there is no time limit for the employee to file the application. Ordinarily, the employee is expected to file his claim for the payment of gratuity within the last week of his/her service and get the payment on the date of his exit from the employer firm. However, the employer can delay the payment up to 30 days. After this period of 30 days, the employer is bound to pay interest to the former employee on the total amount of gratuity payable. If the interest is not paid simultaneously, the employee can demand it separately. The rate of interest is as decided by the Commissioner of Labour who has the powers of the appellate authority. The Commissioner of Labour comes into the picture only after the employee fails to settle his claims amicably and files a complaint against his former employer and not otherwise. For lodging a complaint, an employee must have something in his hand, e.g., proof that his rightful dues have been denied by the employer. To have this, he must first lodge a claim for his dues.

Thanks and regards,

Shyam Agrawal

Dear Anurao,

Thank you for sharing the very good news. Hearty congratulations to you. When you finally receive your gratuity, please remember to post the amount you have received and also specify that it is for a period of 4 years, 11 months, and 10 days. This information could be helpful as a case law or precedent for other individuals in similar situations.

Warm regards.

I joined the deemed/state university in Gujarat as a lecturer on 03/07/2006, and my last working day was 30/06/2011. Due to some reasons, I joined the G.O.G on 02/05/2011 (only one day). My name was registered in the muster at GOG, and I had two posts at the same time, but with WLP at GOG. I have not gone to GOG and continued to serve my previous university until 30/06/2011. Can I get the benefit of gratuity as I completed 4 years and 240 days?

Need clarification on the Gratuity calculation:

1. Those who have completed 4 years and 240 days = 5 years
2. Those who have completed 5 years and 6 months = 6 years.

Dear Sir,

I have completed 4 years and 255 days in the 5th year. Am I eligible for payment of gratuity? Please guide.

You are eligible as per the Madras High Court judgment in the case of Mettur Beardsell Ltd vs. Regional Labour Commissioner, decided by the Madras High Court.