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jagdish vasta (HR Generalist)     10 October 2011

Covergae of gratuity act

Dear Colleagues,

My friend is in his start up of an HR department in his new org. Today he just happen to ask me a query whether for the purpose of coverage of Gratuity act even contract labour are taken into consideration? - means when the act says :

such other establishments or class of establishments, in which ten or more employees are employed, or were employed, on any day of the preceding twelve months, as the Central Government may, by notification, specify in this behalf

and when the definition of an employee itself in the act says:

employee” means any person (other than an apprentice) employed on wages, 2[***] in any establishment, factory, mine, oilfield, plantation, port, railway company or shop to do any skilled, semi-skilled, or unskilled, manual, supervisory, technical or clerical work, whether the terms of such employment are express or implied, 3[and whether or not such person is employed in a managerial or administrative capacity, but does not include any such person who holds a post under the Central Government or a State Government and is governed by any other Act or by any rules providing for payment of gratuity].
 

Let me knmow your expert opinion on it.. I shall be greatful to you'all.

My personal opinion says when we say 10 or more employees its just confined to our permanent employees and not contract workers.. hopwever it is just my view ..

Pls share me your views on it.. Pls its urgent..

 

Jagdish Vasta

Goa



Learning

 7 Replies

akash kapoor (*************)     12 October 2011

IN MY OPINION IT INCLUDES ALL KIND OF EMPLOYEES................................

Vijayarajan (Executive Director)     12 October 2011

It inludes all workers. Even if it was for a single day.

1 Like

jagadish paranjape (Advocate)     09 January 2012

I agree with Shri Vasta.If contract labour were intended to be included, then nothing prevented the legislature from saying so,since it was done in case of P.F. and E.S.I. Act.In my openion to receive gratuity the employee must be an employee of the establishment.Of course status like permanent etc. makes no difference, because the Act does not  contemplate different types of employees.

jagadish paranjape (Advocate)     09 January 2012

I agree with Shri Vasta.If contract labour were intended to be included, then nothing prevented the legislature from saying so,since it was done in case of P.F. and E.S.I. Act.In my openion to receive gratuity the employee must be an employee of the establishment.Of course status like permanent etc. makes no difference, because the Act does not  contemplate different types of employees.

1 Like

Adv. Mandar Pimpalkhare (Advocate)     26 October 2012

R/ Jagdish Sir

i have also one querry in mind regarding the gratuity whether IT companies are liable to pay gratuity if it has back office oerations in maharashtra and orginally a us based companay


ragards

jagadish paranjape (Advocate)     26 October 2012

The Payment of gratuity Act 1972 would be applicable to establishments employing ten or more employees.The office in Maharashtra has to be registered under Bombay Shops and Establishment Act and therefore gratuity would be applicable if the empolyees are ten or more in numbers,.

Vijayarajan (Executive Director)     27 October 2012

The act is applicable to all factories and all other establishments which employ or employed 10 or more employees. It is applicable to IT also.


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