Gratuity
haresh
(Querist) 20 April 2013
This query is : Resolved
i am working in nagrik co-op bank
i leave job last month
my serviced has done 6 year
our bank staff service rule for gratuity is
10 year
gujart guvernment rule for gratuity is 5 years.
lic has no problem for giving gratuity
but bank is not sending letter of lic
so i am able to get gratuity.
tell me what can i do
Advocate M.Bhadra
(Expert) 20 April 2013
Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years:- (i) on his superannuation; or (ii) on his retirement or resignation; or (iii) on his death or disablement due to accident or disease, provided that the completion of continuous service of five years shall not be necessary where the termination of the employment of any employee is due to death or disablement.
The employer shall pay gratuity to an employee at the rate of fifteen days' wages based on the rate of wages last drawn by the employee concerned for every completed year of service or part thereof in excess of six months.
In the case of a monthly rated employee, the fifteen days' wages shall be calculated by dividing the monthly rate of wages last drawn by him by twenty-six and multiplying the quotient by fifteen. While, in the case of a piece-rated employee, daily wages shall be computed on the average of the total wages received by him for a period of three months immediately preceding the termination of his employment, and, for this purpose, the wages paid for any overtime work shall not be taken into account.
The amount of gratuity payable to an employee shall not exceed three lakhs and fifty thousand rupees.
Kerala High Court
Nedupuzha Service Co-Operative ... vs K.Rugmani,Aged 59 Years on 30 May, 2011
IN THE HIGH COURT OF KERALA AT ERNAKULAM
WA.No. 980 of 2010()
1. NEDUPUZHA SERVICE CO-OPERATIVE BANK
... Petitioner
Vs
1. K.RUGMANI,AGED 59 YEARS,
... Respondent
2. LIFE INSURANCE COPORATION OF INDIA,
3. THE JOINT REGISTRAR OF CO-OPERATIVE
4. REGISTRAR OF CO-OPERATIVE SOCIETIES
For Petitioner :SRI.C.E.UNNIKRISHNAN
For Respondent :SRI.LAL GEORGE
The Hon'ble MR. Justice C.N.RAMACHANDRAN NAIR The Hon'ble MR. Justice B.P.RAY
Kumar Doab
(Expert) 21 April 2013
Mr. Bhadra has provided the court judgment which shall help many employees facing similar situation.
Many Thanks.
------Payment of Gratuity Act, 1972:::::
Sec 4(5): “Nothing in this section shall affect the right of an employee to receive better terms of gratuity under any award or agreement or contract with the employer.“
The employer can not opt for any terms and conditions which are inferior or lower or worse than the provisions kept in the statutory provisions of Payment of Gratuity Act, 1972.
The employer has to pass all amounts accrued in a/c of Gratuity of the employee and received by employer from LIC have to be paid to employee, be it even above the statutory limit of Rs.10 Lac.
This is reaffirmed, reiterated, re validated, by the court judgments, and also the judgment quoted by Mr. Bhadra.
If employer has not made the arrangements for payment of Gratuity as per statutory provisions in Payment of Gratuity Act, employer should pay from his own resources.
-Sec 2: Definitions: "retirement" means termination of the service of an employee otherwise than on superannuation;
Implying: “Retirement is separation before attaining age of superannuation’
------There is another provision/policy available for employers to reward the employees with “Superannuation Policy” in addition to Gratuity. The age of Superannuation in such policy is decided by standing orders of the management. Such policies are taken from LIC or FI’s.
If the next employer is having the this “Superannuation Policy” employee may be allowed to carry forward the mounts in the policy to next employer, or the management may pay the amounts to employee on attaining age of superannuation or may decide to make the payment to employee on retirement. You may check and confirm the Bank is blocking the payment of this “Superannuation Policy” or Gratuity.
You have posted that:
------“our bank staff service rule for gratuity is 10 year”
Do you have the copy of these rules?
Does the bank have its own trust to manage the gratuity? If yes download and obtain the copy of rules.
“gujart guvernment rule for gratuity is 5 years.”
Do you have the copy of these rules? If yes submit a representation under acknowledgment addressed to concerned authority in the bank, appointing authority, MD, Chairman, quote the rules and facts and narrate the previous representations made by you to bank citing date, name/designation/dept/address of the bank personnel to whom you have represented in person, by phone (quote numbers, date), email, by letter and demand that payment of Gratuity as received from LIC be supplied to you by bank DD thru redg. post so as top reach you in say……………….days. You may also add that if LIC has declined to release the gratuity, the certified copy of declination issued by LIC, and certified copy of the communication sent by bank to LIC be supplied to you, by redg. post only so as to reach you in say……………days. You may mention that postage prepaid, self addressed envelope envelop(s) is enclosed for sending the redg. post to you. If bank is under RTI you may in the capacity of Ex. Employee demand certified copy of the policy applied by bank and issued by LIC. If bank has approved trade union you may approach union also. Unions are sensitive to such matters as it affects the employees at large.
You have the option to seek information from LIC if you (quote your full name/designation/dept/employee number/address of office/policy number if available) are eligible for Gratuity as per the terms of policy issued by it to your bank, and if bank has supplied any communication to LIC to release your gratuity, and if LIC has declined to pay the gratuity amount held in you’re a/c as on date……………
-“lic has no problem for giving gratuity”
Thus, LIC does not want to err and be a party to the erroneous approach of employer and thus becoming eligible to be awarded with penalty by any lawful authority and court of law.
-“but bank is not sending letter of lic”
Set the ball rolling by submitting FormI under proper acknowledgment, to o/o appointing authority, MD, or designated personnel of the company, for payment of Gratuity., in accordance with…………….. Section: 7 (1) and claim interest for the delay in accordance with Sec:7(3A). It is felt that the interest is simple @10%. However you may confirm it from o/o Controlling Authority of Gratuity which might be DLC.
Since the employer has raised a dispute you may submit a copy of the FormI with proof of submission to employer to Controlling Authority of Gratuity in accordance with Sec 7: 4(b). The controlling authority shall make the payment of amount of Gratuity + excess amount in accordance with Sec 7: 4(d).
It is clear that bank has obtained the policy from LIC in accordance with Sec 4A (1) of Payment of Gratuity Act 1972, ………………………..which states “………….for his liability for payment towards the gratuity under this Act,………”
and after availing the policy has registered the establishment with Controlling Authority in accordance with Sec 4A (3) which states…………….” no employer shall be registered under the provisions of this section unless he has taken an insurance referred…………….”
The payrol dept. of your bank can provide you the policy number and even log in id and P&S dept. of LIC can provide log in id, and thus employee can have on line access to amounts accrued in his a/c of Gratuity.
You may highlight
----- Sec 4 : payment of Gratuity: ( 2) “For every completed year of service or part thereof in excess of six months, the employer shall pay gratuity to an employee at the rate of fifteen days wages based on the rate of wages last drawn by the employee concerned:
Explanation: In the case of a monthly rated employee, the fifteen days wages shall be calculated by dividing the monthly rate of wages last drawn by him by twenty-six and multiplying the quotient by fifteen.
As per Bill No. LI of 2012, THE PAYMENT OF GRATUITY (AMENDMENT) BILL, 2012 , this rate of 15 days was to be revised to 30 days.
If notified the gratuity should be calculated @ 30 days and the max. amount of tax free gratuity is Rs.10 Lacs.
Employer can award even more than Rs.10 lacs and amount above Rs.10 lacs may be subjected to tax treatment by employer.
------Educate/Explain the HR and/or all concerned personnel denying Gratuity to you on payment of Gratuity by other company and penalties, punishment, imprisonment of Whoever..........as described in Sec9.
Emphasize upon the description of word
" WHOEVER"..........
Section: 9
Penalties.
(1) Whoever, for the purpose of avoiding any payment to be made by himself under this Act or of enabling any other person to avoid such payment, knowingly makes or causes to be made any false statement or false representation shall be punishable with imprisonment for a term which may extend to six months, or with fine which may extend to ten thousand rupees or with both……………
haresh
(Querist) 21 April 2013
hi sir
thank for answers
i know i am quilified of gratuity
but bank is not sending letter to lic for withdrawing of grauity amount becauce of bank service rule is 10 year for gratuity.
u said that i have to send FormI under proper acknowledgment.
so i have to appoint lawyer for that or any organization can do this of my behalf.
Kumar Doab
(Expert) 21 April 2013
You can submit FormI on your own. You should submit it under proper acknowledgment.
For your representations to bank rely upon Redg. post and avoid speed post/courier.
Looking into your feedback on the conduct, approach of the bank, you may have to drill sense into the heads to resolve the matter in your favor.
If you do not succeed on your own you may have to pull them before Controlling Authority of Gratuity, court of law.
It shall be better to approach a lawyer and show all docs in person, and proceed under expert advice of your lawyer.
prabhakar singh
(Expert) 21 April 2013
Mr.Kumar Doab has extensively and lucidly dealt your query.
It is doubted if any establishment can bypass terms of a statute by framing rules of service quite contrary to an Act.
