As per gratuity payment Eligibility criteria one needs to complete 4 years, 240 days to get gratuity payment.
Keeping above criteria in mind , If an employee has worked 4 years 207 days and rest 33 days employees pays the organization as short notice period . Is he eligible for Gratuity payment? Can the employee take legal action on the employer if he is not paid the Gratuity payment , Since he is buying 33 days.
Regards
Arun Fijardo
From Singapore
Keeping above criteria in mind , If an employee has worked 4 years 207 days and rest 33 days employees pays the organization as short notice period . Is he eligible for Gratuity payment? Can the employee take legal action on the employer if he is not paid the Gratuity payment , Since he is buying 33 days.
Regards
Arun Fijardo
From Singapore
No, he is not eligible
Even supreme court has ruling that 5 years work means 5 years actual work. Paying notice period is part of the contract but cannot be considered as that person has actually worked in the organisation.
From India, Mumbai
87Even supreme court has ruling that 5 years work means 5 years actual work. Paying notice period is part of the contract but cannot be considered as that person has actually worked in the organisation.
From India, Mumbai
Dear Fijardo,
I believe the 240 is the clause with working days which will come to account as full 1 year working if we deduct the weekends holidays etc...
So practically it's 5 years...
Even if we give benefit of doubt of being eligible with 4 yrs and 240 days,... you are mentioning that
The person is working for 207 days... The last working day in effective was 207th day in the year... Gratuity is calculated w.r.t to your joining date and last working date....
The notice pay that the person would give will be against the early relieve that he/she wants.
Also kindly note that if the person thinks that s/he would resign and give 30 days notice as per clause, it will be upto the company to decide if they want the person to be relieved earlier....
So the company can relieve you say immediately or in week's time and again the person do not become eligible for gratuity...
Hope I was able to solve your doubts....
From India, Mumbai
I believe the 240 is the clause with working days which will come to account as full 1 year working if we deduct the weekends holidays etc...
So practically it's 5 years...
Even if we give benefit of doubt of being eligible with 4 yrs and 240 days,... you are mentioning that
The person is working for 207 days... The last working day in effective was 207th day in the year... Gratuity is calculated w.r.t to your joining date and last working date....
The notice pay that the person would give will be against the early relieve that he/she wants.
Also kindly note that if the person thinks that s/he would resign and give 30 days notice as per clause, it will be upto the company to decide if they want the person to be relieved earlier....
So the company can relieve you say immediately or in week's time and again the person do not become eligible for gratuity...
Hope I was able to solve your doubts....
From India, Mumbai
Dear Arun ji,
You are under wrong impression. Gratuity is payable on completion on 5 years of service and not before that.
Madras HC judgement is not applicable to other states. If you are in Madras, this judgement is in your benefit but you should render 240 days in 5th year of your service. Notice pay is a payment in lieu of your short notice.
From India, Mumbai
You are under wrong impression. Gratuity is payable on completion on 5 years of service and not before that.
Madras HC judgement is not applicable to other states. If you are in Madras, this judgement is in your benefit but you should render 240 days in 5th year of your service. Notice pay is a payment in lieu of your short notice.
From India, Mumbai
Dear Arjuna Fijardo,
The PG Act,1972 clearly stipulates a minimum period of Five years for the eligibility of gratuity with some exceptions.It is only the courts,who have made some dilution in the norms to give benefits (in the last year) to the persons who are nearing completing Five years.It is absurd to think that by paying a small sum you can claim a bigger amount as both the privileges are different in nature and cannot be equated.The gratuity is governed by a statute whereas the notice period is a term & condition of your appointment.I suggest you to wait and serve your present employer for the shortfall of days for being entitle to payment of gratuity.
BS Kalsi
Member since Aug 2011
From India, Mumbai
The PG Act,1972 clearly stipulates a minimum period of Five years for the eligibility of gratuity with some exceptions.It is only the courts,who have made some dilution in the norms to give benefits (in the last year) to the persons who are nearing completing Five years.It is absurd to think that by paying a small sum you can claim a bigger amount as both the privileges are different in nature and cannot be equated.The gratuity is governed by a statute whereas the notice period is a term & condition of your appointment.I suggest you to wait and serve your present employer for the shortfall of days for being entitle to payment of gratuity.
BS Kalsi
Member since Aug 2011
From India, Mumbai
Hello,
The minimum period for eligibility of gratuity is 5years of service with first 4years as full and in the fifth year you may work for 240 active days in 365 days of the year. This period can not be condoned. Thus you are not eligible for gratuity. You should have considered this fact prior to your resignation or issue of notice for leaving the company.
Mahavir Mittal
From India, New Delhi
The minimum period for eligibility of gratuity is 5years of service with first 4years as full and in the fifth year you may work for 240 active days in 365 days of the year. This period can not be condoned. Thus you are not eligible for gratuity. You should have considered this fact prior to your resignation or issue of notice for leaving the company.
Mahavir Mittal
From India, New Delhi
This is a litigate-able issue, technically he has not worked 240 days in the 5th year which is the deciding factor, had he worked in the notice period he would be eligible without a doubt, at the same time his period of service can also be considered including the notice period nonetheless if you go strictly on the 'contract of employment' basis, but since he was relieved upfront by the company by paying the notice pay it becomes an issue that can be taken up before the court. However in all probabilities if the employee approaches the authority under the gratuity Act claiming it, in the name of beneficial legislation it will go in his favor, I doubt even the high court will interfere in such cases, although without setting a precedent as such [taking the case in isolation]. So I suggest you pay the gratuity and save yourself of the litigation trouble and don't forget the interest and penalty that will be imposed for the delay in payment of gratuity if you lose in litigation, its just not worth it, being hyper-technical will not help in this issue as the situation is debatable in legal terms, you need to have a more practical approach.
From India, Chennai
From India, Chennai
Ac coding to the payment of gratuity act 1972 completed 5 years working in any organization eligible to gratuity with continues service without any break.
From India, Tirupati
From India, Tirupati
Dear Arun Fijardo,
Greetings for the day,
Noted that 4 years +240 days= 5 years of service, but it must be noted that 240 days should be the working days, then after notice period should also be consider for the payment.
Thanks & Regards,
From,
Sumit Kumar Saxena
From India, Ghaziabad
Greetings for the day,
Noted that 4 years +240 days= 5 years of service, but it must be noted that 240 days should be the working days, then after notice period should also be consider for the payment.
Thanks & Regards,
From,
Sumit Kumar Saxena
From India, Ghaziabad
Sumit Kumar,
Yes, notice period is considered into the payment period as the act says that the working period is to be calculated from date of joining til last working date.
However if the employer accepts your resignation and relieves you earlier, in that case it may happen that one loses gratuity after serving almost full period only for a couple of months...
Hence, when someone has already served for 4 years and 8-10 months, we normally advice to complete full 5 years and then resign so that even if the company is willing to relieve him/her tomorrow, he/she still stands eligible...
Hope this helped...
From India, Mumbai
Yes, notice period is considered into the payment period as the act says that the working period is to be calculated from date of joining til last working date.
However if the employer accepts your resignation and relieves you earlier, in that case it may happen that one loses gratuity after serving almost full period only for a couple of months...
Hence, when someone has already served for 4 years and 8-10 months, we normally advice to complete full 5 years and then resign so that even if the company is willing to relieve him/her tomorrow, he/she still stands eligible...
Hope this helped...
From India, Mumbai
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Gratuity Eligibility.pdf
Gratuity eligibility for less than 5 yrs. (4yrs.240days). docx