subhash (senior executive) 12 April 2014

Full and final settlement

Dear Sirs,

My father working as an accountant for last 20 years in a Fertilizer shop in B class town. As per his will he is working now at the age of 66 years.

Now I he decided to take retirement.

Can someone tell me that is he entitle to get any full & final settlement amount in lieu of bonus or gratuity from the proprietor.

I do not have any idea about labour act rules and regulators.

For example, his last drawing salary is Rs.5000/- per month, how much he can get the settlement amount for his 20 years service renderred.

Is my father can I expect any bonus or gratuity from the proprietor at the time of resignation?

Please provide your valuable advises.

Thanks,

Subhash

Reply Follow

1 Replies

Kumar Doab (FIN) 12 April 2014

Bonus and Gratuity is in addition to FNF wages.

Hope he has been getting salary slips for each month of employment showing DOJ, and has appointment letter. He should have also been covered by PF, ESIC…………and must have been getting PF /ac slip of each year of service, ESIC card……………………

Be particular for ESIC card as he would be eligible for ESIC coverage (with wife) even after retirement.

If Payment of Bonus Act is applicable then employer should have paid Bonus each year.

If 10 or more people were employed at a point of time then Payment of Gratuity Act 1972 should be applicable and he should be eligible for Gratuity.

Payment of Gratuity Act, 1972

Sec:1:(3) (b) (c) (3A), Sec2A,4,7

He can submit FormI one month before retirement, under proper acknowledgment of course.

Even if application is not made, employer should pay Gratuity within 30 days from date of becoming eligible.

Formulae for calculation of Gratuity: (Basic+DA)/26*15* NO. of years of service

(Basic+DA) shall be as per Last drawn salary

For period of service more than 6 month count it as 1year.

IN FNF settlement he shall get Bonus, Gratuity, leave encashment, salary for days worked in last month of employment, and other amounts as applicable, along with last month salary slip, PF a/c slip, service certificate, relieving letter, Form16………………

IN case of any difficulty he may get in touch with ALC in local O/O Labor Commissioner, Inspector under (Name of your state) Shops and Commercial Establishments Act, Inspector under Payment of Wages Act……………….

1 Like