Can an employer decrease their percentage of gratuity? Currently, one employer is paying 10% gratuity instead of 4.81%. Can that amount be reduced to 4.81%? Are there any cases where this has been done? Is there any law that prevents an employer from making this change?
From India, Pune
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From India, Pune
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Dear Parashar,
Please refer to the link below. I hope you will get the idea: https://www.citehr.com/423789-reg-gr...ml#post1918674
From India, Mumbai
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173Please refer to the link below. I hope you will get the idea: https://www.citehr.com/423789-reg-gr...ml#post1918674
From India, Mumbai
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I don't know what is the significance of 10% or 4.81% in gratuity calculation. But in any case, it should not be less than 15 days' salary for every completed year of service subject to a maximum of Rs 10 lakhs. Salary for this purpose means the salary at the time the employee leaves the company. If your calculation exceeds this amount you can pay, no problem. If the practice is to pay a higher amount and the same has been reflected in the offer or contract of employment by way of CTC, then you have to follow that. In order to reduce it, you need to change the conditions of service by issuing notice under section 9A of the Industrial Disputes Act.
Madhu.T.K
From India, Kannur
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Madhu.T.K
From India, Kannur
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Gratuity calculation.doc
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