We are showing Gratuity as a part of CTC while issuing the Appointment Order. Can an employee claim payment of Gratuity before completion of five years of service on the grounds that this is a part of CTC?
Thanks,
Ajee Morolia
From India, Delhi
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4Thanks,
Ajee Morolia
From India, Delhi
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Hi Ajay,
It's not possible because it's beyond the law. Then, even one may claim for Pension fund also as it's also a part of CTC, which is not possible. CTC includes so many contents, and even we actually don't get benefited from all the contents.
Regards,
Amit Seth
From India, Ahmadabad
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It's not possible because it's beyond the law. Then, even one may claim for Pension fund also as it's also a part of CTC, which is not possible. CTC includes so many contents, and even we actually don't get benefited from all the contents.
Regards,
Amit Seth
From India, Ahmadabad
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My dear, if you include the Gratuity amount in CTC, it definitely becomes a part of your salary, and the employee can ask for its payment if they leave the company before completing 5 years. This is a prevalent practice in the industry. As far as the payment of PF is concerned, the amount directly goes to the employee's account, and they do not have to ask the employer for payment.
Regards,
H R Singh
From India, Mumbai
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Regards,
H R Singh
From India, Mumbai
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Dear Ajay,
In continuation of Amit's comment, he is right. Not all parts of the CTC are received by everyone. CTC stands for Cost to Company; it represents the employer's cost of keeping an employee on its payroll. It does not mean that everything mentioned in the CTC will be payable to the employee.
From India, Mumbai
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In continuation of Amit's comment, he is right. Not all parts of the CTC are received by everyone. CTC stands for Cost to Company; it represents the employer's cost of keeping an employee on its payroll. It does not mean that everything mentioned in the CTC will be payable to the employee.
From India, Mumbai
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Hai Moralia, We can stop the payment of Gratuity also on certain grounds, though it is a benefit to an employee and part of CTC.So he cannot claim for it. Sirisha.
From India, Hyderabad
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From India, Hyderabad
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Dear Friend,
Although I am unable to give the exact information you require, Kindly click on the following link, it will give you some required information,
https://www.citehr.com/search_new.ph...uity&submit=Go
https://www.citehr.com/search_new.ph...atuity+Payment
Pls let me know was this information useful,,
If not let me try out more & give information,,,,
Please never loose patience once you have posted it,, give members time to reply,,,,
In CiteHR you will get A to Z information on HR…..
Regards
M. Peer Mohamed Sardhar
93831 93832
From India, Coimbatore
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Although I am unable to give the exact information you require, Kindly click on the following link, it will give you some required information,
https://www.citehr.com/search_new.ph...uity&submit=Go
https://www.citehr.com/search_new.ph...atuity+Payment
Pls let me know was this information useful,,
If not let me try out more & give information,,,,
Please never loose patience once you have posted it,, give members time to reply,,,,
In CiteHR you will get A to Z information on HR…..
Regards
M. Peer Mohamed Sardhar
93831 93832
From India, Coimbatore
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Mr. Peer, Your contribution is remarkable, only the principle is this that no one can supersede regulation, acts and the same principle also governs this issue Thanks Ajay Morolia 8) :wink:
From India, Delhi
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From India, Delhi
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Dear Member,
Payment of Gratuity is a statutory obligation on employers. It is payable upon the completion of a minimum of 5 years of continuous service on retirement, resignation, or death. The condition of 5 years of continuous service is not applicable in the case of death.
According to the law, the company is liable to pay only if the employee has rendered a minimum of 5 years of service. This payment is made in recognition of the continuous service the employee has provided to the organization, and if the employee leaves before 5 years, they are not eligible to claim gratuity.
However, the Payment of Gratuity Act, 1974, envisions compulsory insurance of the employer's liability to pay gratuity. This cost is obviously included in CTC. It means it is the cost borne by the employer to keep the employee in their establishment.
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Payment of Gratuity is a statutory obligation on employers. It is payable upon the completion of a minimum of 5 years of continuous service on retirement, resignation, or death. The condition of 5 years of continuous service is not applicable in the case of death.
According to the law, the company is liable to pay only if the employee has rendered a minimum of 5 years of service. This payment is made in recognition of the continuous service the employee has provided to the organization, and if the employee leaves before 5 years, they are not eligible to claim gratuity.
However, the Payment of Gratuity Act, 1974, envisions compulsory insurance of the employer's liability to pay gratuity. This cost is obviously included in CTC. It means it is the cost borne by the employer to keep the employee in their establishment.
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Hi all,
I agree with all the valuable comments above. As per the Gratuity Act, gratuity has to be paid by the company after completion of 5 years of continuous service. However, the company can formulate its internal policy and pay the gratuity even before the 5-year term. If the internal policy is silent about this, in that case, the company is liable to pay after completion of 5 years of service. In short, it can be early but not late. That is what my understanding is. I hope I am correct.
Regards,
Prasad
From India, Bangalore
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I agree with all the valuable comments above. As per the Gratuity Act, gratuity has to be paid by the company after completion of 5 years of continuous service. However, the company can formulate its internal policy and pay the gratuity even before the 5-year term. If the internal policy is silent about this, in that case, the company is liable to pay after completion of 5 years of service. In short, it can be early but not late. That is what my understanding is. I hope I am correct.
Regards,
Prasad
From India, Bangalore
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Hi,
It has been agreed in principle that gratuity is a part of CTC. The annexure you attach with the appointment letter showing the breakup of salary should mention that gratuity is payable as per the Gratuity Act, 1972. This will take care of the perceived problem you feel you may face.
Regards,
Subrato
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It has been agreed in principle that gratuity is a part of CTC. The annexure you attach with the appointment letter showing the breakup of salary should mention that gratuity is payable as per the Gratuity Act, 1972. This will take care of the perceived problem you feel you may face.
Regards,
Subrato
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SBT Vs Asst. Labour Commissioner- Gratuity dismissed employee-LTS.PD F
FORM I(Application for Gratuity by an employee).doc