Libraries are covered under Gratuity Act

This is the news item published in Hindu

“Library employees entitled to gratuity”

Staff Reporter

MADURAI: Libraries cannot deny gratuity to their employees unless and otherwise they had been exempted from making such payment under Section 5 of the Payment of Gratuity Act, the Madras High Court has ruled.

Justice K. Chandru passed the ruling while dismissing cases filed by Thanjavur Maharaja Sarfoji Saraswati Mahal Library and Research Centre against orders passed by a Joint Labour Commissioner to pay gratuity to two of its employees.

The judge recalled that the Supreme Court in State of Punjab Vs. Labour Court, Jullundur (1980) had held that the term ‘establishment' found in the Gratuity Act should not be confined only to commercial establishments.

According to the apex court, Parliament would not have left the expression ‘establishments' unqualified in the Act if its intention had been to confine the benefit only to employees of commercial establishments.

It was categorically stated that the Gratuity Act would apply to every establishment within the meaning of any law for the time being in force in relation to establishments in a State. “It cannot be held that the library is not covered by the provisions of the Act.”

He refused to accept petitioner's other contention that it need not pay gratuity to its employees as they were already part of the contributory provident fund scheme which was the only terminal benefit they were entitled to.

“The contributory provident fund scheme is an entirely different concept and it could be in no way compared with the provisions of the Payment of Gratuity Act. Even very recently the Supreme Court had held that gratuity can be received by an employee even if there is a scheme for pension,” he said.

The payment of gratuity Act applies to evert shop and establishment employing ten or more employees.The libraries are establishments and therefore amenable to provisions of gratuity Act.If the library has ten or more employees, then employees of such establishments are entitled to receive gratuity as terminal benefit.

The payment of gratuity Act applies to evert shop and establishment employing ten or more employees.The libraries are establishments and therefore amenable to provisions of gratuity Act.If the library has ten or more employees, then employees of such establishments are entitled to receive gratuity as terminal benefit.