V.R (Student) 07 September 2009

Criteria for Superannuation Fund/Gratuity

Hello,

In this organization, the superannuation fund policy of the company states that the company will contribute towards the superannuation fund - which would be 15% of the basic salary. But the criteria for the company to contribute is not based on a minimum number of years of service in the organization but based on a certain designation.

I would like to know whether this is valid for a company to set up a contribution based on a designation rather than the number of years of service in the company.

If the designation does not change in the company, does that mean that there will be no contribution by the company towards superannuation fund.

Is this legal?

Thanks,

V.R

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1 Replies

Ashish Ovalekar (Manager Legal & Compliance) 08 September 2009

Dear V.R.,

The Superannuation Fund is not governed by any Statute or Mandatory for a Company to maintain the same.

The Company as a employee welfare measure, might have initiated such Policy.

Therefore its is governed by the terms and conditions of the Superannuation Policy. Therefore it is the discretion of the Company, as to whom it should be made applicable.