Gratuity :
It is given to a Person for Long and Meritorious Service in any Industry. gratuity is payable even to an employee who resigns after completing at least 5 years of service.
Applicability:
Every factory, Mine, Oil field, Plantation, Port, Railways, Company, shop establishment or educational institutions employing ten or more persons
Main Provisions
Gratuity Eligibility Criteria:
Gratuity shall be payable to an employee on termination of his employment after he has rendered continuous service for not less than 5 years. Thus for an employee to become entitled for the payment of gratuity, he must have rendered continuous service of at least 5 years. The completion of continuous service of 5 years is not necessary where the termination of the employment of an employee is due to his death or disablement.
Wages for calculation:
Gratuity is calculated at the rate of 15 days’ wages for every completed year as if the month comprises of 26 days at the last drawn wages.
Monthly Salary x 15 days x No. of yrs. of service/
26
Employee: All employees irrespective of status or salary.
Qualifying period: On rendering of 5 years of service either on termination or on resignation or retirement.
Entitlement: On completion of 5 years service except in case of death or disablement.
Maximum ceiling: Rs.3,50,000/-
When Gratuity not Paid??? :
* On termination of an employee for disorderly behaviour
* Wholly or partly for willfully causing loss destruction of property, etc.,
Penalties:
* Imprisonment for six months or fine upto Rs.10,000 for avoiding to make payment by making false statement or representation.
* Imprisonment not less than 3 months and upto one year with fine on default in complying with the provisions of Act or rules.
For More Reference check the given below link:
1.
Payment Of Gratuity Act 1972