Upgrad
LCI Learning

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More

Clarity between gratuity eligibility service (5 or 4.8 yrs)?

Page no : 7

Vijay (Tech Lead)     19 September 2012

Hello Sir,

I am eligible (6.5 years) for gratuity and my resignation has been accepted from my employer (Delhi based). Now , I have joined new company in Bangalore. But my previous employer still not paying the gratuity amount as It's been more than 7 months. I do write mail and make call, at that time they always say "Your gratuity amount  will be released soon". In this way, they are not releasing gratuity amount and not interested to pay any compensation (interest like  5 to 10%) which I could easily get by Fixed Deposit if amount could have given to me 7 Months back.

My query is : As per law, How many days should EMPLOYER  take to release the Gratuity amount after acceptance of resignation (i.e. from the last day ).

Please respond at the earliest and suggest what should I do.

Regards,

Vijay

Vijay (Tech Lead)     19 September 2012

Hello Sir,

I am eligible (6.5 years) for gratuity and my resignation has been accepted from my employer (Delhi based). Now , I have joined new company in Bangalore. But my previous employer still not paying the gratuity amount as It's been more than 7 months. I do write mail and make call, at that time they always say "Your gratuity amount  will be released soon". In this way, they are not releasing gratuity amount and not interested to pay any compensation (interest like  5 to 10%) which I could easily get by Fixed Deposit if amount could have given to me 7 Months back.

My query is : As per law, How many days should EMPLOYER  take to release the Gratuity amount after acceptance of resignation (i.e. from the last day ).

Please respond at the earliest and suggest what should I do.

Regards,

Vijay

Isaac Gabriel (Advocate)     19 September 2012

Issue I form to the employer and file case with the Copetent Authority

Kumar Doab (FIN)     19 September 2012

Mr. Gabriel has given valuable advice. Kindly follow it.

If you submitted notice of resignation say of a month, you have notified your last day in office/effective date of resignation/date of retirement to employer and employer should have paid gratuity on last day in office or computed in FNF statement and paid vide FNF settlement, along with superannuation payment if your company had any superannuation scheme also. Employer can make the payment of superannuation on date of retirement as described in standing orders or before.

You could have stated in notice of resignation to disburse gratuity and superannuation on last day in office, and could have submitted Form I a month before last day in office.

THE PAYMENT OF GRATUITY (CENTRAL)

RULES, 19721

 

     7. Application for gratuity.-(1) An employee who is eligible for payment of gratuity under the Act, or any person authorised, in writing, to act on his behalf, shall apply, ordinarily within thirty days from the date the gratuity became payable, in Form 'I' to the employer:

 

    Provided that where the date of superannuation or retirement of an employee is known, the employee may apply to the employer before thirty days of the date of superannuation or retirement.

It is felt that you may submit a gentle communication addressed to good offices of your appointing authority, MD, Chairman, Company Secretary, with a cc/copy to Head HR, and narrate all representations made so far by phone, email, by letter, in person, mentioning date of each representation and name of company employee…….designation..dept…..address….., and request the good offices to disburse payment to you by redg. post only and you may mention that a postage prepaid { as purchased from PO}, self addressed envelope is enclosed herewith for supplying the payment to you.You may conclude that Mr/Ms…… designation..dept…..address…have been stating that gratuity payment shall be released soon without specifying any date and have never supplied the payment o you till date.

You may submit Form I under acknowledgment to good office of your appointing authority. You may submit copy to Controlling Authority under acknowledgment which may be ALC at your location, and enclose copy of your representation to good offices.

Payment of Gratuity Act, 1972

 

Section: 7
Determination of the amount of gratuity.

 

 (1) A person who is eligible for payment of gratuity under this Act or any person authorised, in writing, to act on his behalf shall send a written application to the employer, within such time and in such form, as may be prescribed, for payment of such gratuity.

(2) As soon as gratuity becomes payable, the employer shall, whether an application referred to in sub-section (1) has been made or not, determine the amount of gratuity and give notice in writing to the person to whom the gratuity is payable and also to the controlling authority specifying the amount gratuity so determined.

(3) The employer shall arrange to pay the amount of gratuity within thirty days from the date it becomes payable to the person to whom the gratuity is payable.

(3A) If the amount of gratuity payable under sub-section (3) is not paid by the employer within the period specified in sub-section (3), the employer shall pay, from the date on which the gratuity becomes payable to the date on which it is paid, simple interest at such rate, not exceeding the rate notified by the Central Government from time to time for repayment of long-term deposits, as that Government may, by notification specify:

Provided that no such interest shall be payable if the delay in the payment is due to the fault of the employee and the employer has obtained permission in writing from the controlling authority for the delayed payment on this ground.]

 

Vijay (Tech Lead)     06 October 2012

How to file case with the Copetent Authority as still i didn't get any response from my employer for gratuity amount. As i am a middle class man so fearing to file case  because it will be very hard to me to fight with well establise company where they have lots of lawyer already appointed for different cases. Also, Their judiciary place is Delhi and i am living in Bangalore. 

Please suggest what to do.

 

Regards,

Vijay

Kumar Doab (FIN)     07 October 2012

Submitting FormI to good office of appointing authority is not filing a case/litigation, or fight.

Submitting gentle representation to good offices of  your appointing authority, MD, Chairman, Company Secretary, with a cc/copy to Head HR, and narrate all representations made so far, is not filing a case/litigation.

Submitting copy of FormI with copy of representation {to good offices of company}, to Controlling Authority of Gratuity which may be ALC, is not filing a case/litigation.

 

 

As per Payment of Gratuity Act, {which is already provided in previous posts and given below for your ready reference} employee has to apply for payment of Gratuity in “within such time and in such form, as may be prescribed”.

 

So, if you want payment of gratuity, you may submit Form I under acknowledgment to good office of your appointing authority. You may submit copy to Controlling Authority under acknowledgment which may be ALC at your location, and enclose copy of your representation to good offices.

 

If you are not able to visit personally, you can authorize a person, in writing, to act on your behalf.

As far as interest on delayed payment is concerned it is felt that it is 10%, however you may check with o/o ALC: “the employer shall pay, from the date on which the gratuity becomes payable to the date on which it is paid, simple interest at such rate, not exceeding the rate notified by the Central Government from time to time for repayment of long-term deposits”

If you wish to claim payment is delayed by employer you must submit written communications to employer narrating all representations made by you so far.

In your case you are eligible for gratuity and employer has not given any notice to you as in Sec 7 {2}, hence you should be eligible for interest.

The payment of gratuity Act is enacted to benefit the employee, and in your case you are not at fault. In all likelihood the controlling authority for gratuity should take decision favoring the employee, and employer shall on its own disburse the gratuity.

Once again you may go thru:

Payment of Gratuity Act, 1972

 

Section: 7
Determination of the amount of gratuity.

1,2,3,3A

 

In case you are still facing any difficulty you may consult elders in the family, competent and experienced well wishers, trained legal mind amongst your acquaintances, senior trade union leader, lawyer/law firm.

Nithin M Agarwal (Vice President)     08 October 2012

Dear Kirti Sir

i have joined theorganisation on 13November2007 and resigned on 30june2012, and my last day of working was on 14Aug2012. As per the gratuity act i am eligible to get gratuity; but my organisation is stating that the rule of '4.8years of continuous service' is not applicable for our company since is differ from company to company and we have tied up with LIC and LIC allows gratuity only after 5years of completion. Is there exist such law or the company is trying to misguide me. if company is misgiding me, then what action should be taken by me to get my gratuity?.

Thanks N Regards

Nithin

Isaac Gabriel (Advocate)     08 October 2012

You ar eligible.If your employer refuses,Issue i form and proceed to file a case with the controlling Authority.gratuity Act will prevail and nothing can override it.

Kumar Doab (FIN)     08 October 2012

Mr. Gabriel has given valuable advice.Kindly follow it.

You have posted that "but my organisation is stating that the rule of '4.8years of continuous service' is not applicable for our company since is differ from company to company and we have tied up with LIC and LIC allows gratuity only after 5years of completion." Has your company or any personnel of the company has made this statement in writing? if yes take a printout and keep it safely.

You may start your process by submitting FormI under proper acknowledgment,to good offices of  your appointing authority, and a copy to to Controlling Authority of Gratuity which may be ALC, under acknowledgment along with a copy of your representations to good offices of the company.

You may also submit a gentle representation in writing under acknowledgment addressed to good offices of  your appointing authority, MD, Chairman, Company Secretary, with a cc/copy to Head HR, and narrate date wise, all representations made so far and write down the remarks made by each employee of the company with his/her name/designation/dept/address.

It is felt that your company or any company for that matter or LIC or any coproration for that matter does not enjoy any kind of immunity from provisions of the Act, law of the land, rule of court of law.

It is felt that the HC and SC decisions posted in this thread are crystal clear and can not be faulted.

Nithin M Agarwal (Vice President)     10 October 2012

Thanks Mr Gabriel and Mr Kumar for your valuable advice.

Further to get my gratuity, i ask them to take 'Form I' but they refused to accept it, stating that 'we have consulted to our law consultant as well as labour consultant, this is not an amendment but a order given by Madras High Court  (and we are maharashtra based MNC) and this is state specific, not applicable to all India level', what action i may take further, because they are not communicating a single word in writing.

But as i read this Forum from the very first post, and i came to know the order has also been given by Supreme Court". also i am getting confuse on one point ie. in this fourm the following line of judgement has been written

SC judgement:

"hence an employee rendering service of 4 year 10months 11days is considered to have completed 5 years continuous service under sec.4(2) and thereby is eligible for gratuity."

The judgement has already been attached.

this shows the service period is of 4years and 311 days while my service period is of only 4years 275days, please clarify this.

Thanks

Nithin

Ravi Chouhan (Area Sales Manager)     10 October 2012

Dear Sidd

Thank you very much for the support extended.

 

Rgs

Ravi

Kumar Doab (FIN)     11 October 2012

@ Nithin,

Prepare a letter addressed to your appointing authority, MD, Company Secretary and narrate all representations made so far by phone, in person, email, letter etc with date, time, phone numbers etc and mention name, designation, dept, address of company personnel and all statements made by them including   'we have consulted to our law consultant as well as labour consultant, this is not an amendment but a order given by Madras High Court  (and we are maharashtra based MNC) and this is state specific, not applicable to all India level',} and mention that these company personnel have declined to accept FormI on dated……..from you, hence you are submitting by  letter by redg. post. You may mention that you are enclosing self addressed postage prepaid envelope for reply of company by redg. Post to you, say within next 7 days, anddemand payment of gratuity as per payment of gratuity act.

Submit copy of FormI and letter to good offices of your company under acknowledgment, to controlling authority of gratuity.

Kumar Doab (FIN)     12 October 2012

Section: 2A
Continuous service.

For the purposes of this Act, -

(2) where an employee (not being an employee employed in a seasonal establishment) is not in continuous service within the meaning of clause (1), for any period of one year or six months, he shall be deemed to be in continuous service under the employer -

(a) for the said period of one year, if the employee during the period of twelve calendar months preceding the date with reference to which calculation is to be made, has actually worked under the employer for not less than -

(i) one hundred and ninety days, in the case of an employee employed below the ground in a mine or in an establishment which works for less than six days in a week; and

(ii) two hundred and forty days, in any other case;

Does your company operate on the basis of 6days/week in office where you are located?

If yes you might have completed 240 days in 5th year.If yes you have satidfied the condition of 5 years, as gievn in the act.

Date of reference; last day in office/from the date you have been relieved.

The act is clear.

sujal (Data Entry)     27 October 2012

Sir,

I Am completed 4.9years in Private Company (6 DAYS WORKING). My date of Joining 1st February 2008. can I eligible for Gratuity Payment.
 

Arshad (SSE)     14 November 2012

Hi All ,


I worked in my previous company from 15-Mar-2004 to 05-Dec-2008 which makes it 4 years and 265 calendar days . Would i be eligible for payment of gratuity ? Can i approach them now for the payment as the payment was not done during my settlement .

Was the rule the same during the 2004-2008 time period ( Gratuity applicabilty for 4 years and 240 days ) ?

Warm Regards,

Arshad


Leave a reply

Your are not logged in . Please login to post replies

Click here to Login / Register