Dear Tripathi Sir,
I am new to this site which is quite informative and I would request you to kindly suggest me on the following questions:
This is in reference to the query raised by Akshata about the components included in the wages for the purpose of calculation of gratuity. As given by you the definition of wages in Gratuity Act “527.(s) "wages" means all emoluments which are earned by an employee while on duty or on leave in accordance with the terms and conditions of his employment and which are paid or are payable to him in cash and includes dearness allowance but does not include any bonus, commission, house rent allowance, overtime wages and any other allowance.”
Along with the above I also consulted a couple of labour law books ( not bare act) for the definition of wages which also mentions the same “but does not include any bonus, commission, house rent allowance, overtime wages and any other allowance.”. So in the above mentioned case of Akshata will Taxable and Supplementary Allowance will be included in the calculation of gratuity as they are also allowances and the definition says only Basic and DA should be included. This is more with reference to the private sector salaries which is mainly constituted of Basic and other allowances and not DA.
- Will PF be included in the calculation of gratuity provided that employee is contributing both the employer and his / her contribution from his / her salary as a PF deduction.
- While reading the Act I come across the term “Controlling Authority” quite many times. Please suggest that this Controlling Authority is the Asst. PF commissioner or someone else.
- After receiving the Gratuity Application form from the employee and paying the gratuity to the respective employee did the employer has to send that application form to the controlling authority or some communication needs to be made to him about the payment.
- Now the gratuity limit has been raised to Rs. 10,00,000 so as per earlier notifications it remains fully exempted or it will be taxable after a certain amount specially for the private sector employees.
- If a female employee takes more then 12 weeks of maternity leaves then while calculating his gratuity additional leaves above 12 weeks will be considered or not as to the best of my knowledge Maternity benefit act gives a privilege of additional 1 month leave to a female provided that she presents a certificate from a doctor that she needs one more month leave as result of some complication due to maternity process.
I will be highly grateful if some information can be given on the above.
Thanks in advance.