Continuation of service
VIJAY K. TEOTIA
(Querist) 03 December 2011
This query is : Resolved
Can a transfer of an employee from one company to another company may be treated as continuation of service for the purpose of Gratuity benefits. Both companies are separate entities under the company's act. However 2nd company is wholly subsidiary of parent company.
Guest
(Expert) 03 December 2011
Depends upon the language of the transfer order and the terms and conditions of the order. So, unless the terms of the transfer order are not made known, no definite guidance can be provided.
M/s. Y-not legal services
(Expert) 03 December 2011
while being as a branch to your earlier company, i feel its can be treated as continuation of service.,
mahendrakumar
(Expert) 04 December 2011
based on the wordings of your query,i am answering,i.e since it is a "transfer" to a subsidiary company,service would be counted for gratuity.
Shailesh Kr. Shah
(Expert) 04 December 2011
Prima facie, It is not seems continuance of service unless contents of transfer letter.
Guest
(Expert) 04 December 2011
Needless to mention, both are two different legal entities. That is why I put some query to you, as in my views, the management might have shifted you to another entity just to evade payment of gratuity, to which you would be eligible in your previous organisation. On the other hand, in your new organization your service starts afresh and you would have to earn adequate service to be eligible for gratuity in that firm.
So, all depends upon the language used by the management in the transfer order.
RAJU O.F.,
(Expert) 04 December 2011
Two separate entities of companies cannot transfer an employee from one company to another company. Hence it cannot be treated as a transfer of appointment but could be fresh appointment in the new company wholly owned by the first company. As such, the eligibility of gratuity in your case depends upon the provisions in your appointment order in the new company agreed by you.
Jai Karan Nagwan
(Expert) 04 December 2011
Any employee transfered from between subsiduary to holding or vice versa would be deemed as continuence of service, if at all any provision made which disentitle you from gratuity for previos service would be case of undue influence, as such letter which disentitle you to get benfits of previos services would be null and void. crux you are eligible for continuity of services.
VIJAY K. TEOTIA
(Querist) 06 December 2011
thanks to all. finally it appears that if fresh letter admits continuation of service and provides enjoyment of all existing rights then there will be no harm.
Guest
(Expert) 11 December 2011
Of course, your presumption is correct, Mr. Teotia. If no continuation of service is assured in the order of transfer to the new entity, that would tantamount to discontinuation of service with the previous organisation.
