Dear Seniors, What is meant by Break in Service as per Gratuity Act? Do private organization can follow this ? Or only it is limited to Government Organization only? Thanks in advance.
From India, Pune
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494From India, Pune
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Dear Prashanth,
In the context of the Payment of Gratuity Act, 1972, break in service refers to the period during which the continuity of the service of an employee stands snapped while still the contract of employment between the employer and the employee subsists. In other words, any period of interruptions in service other than those deemed to be non-interruptions under Section 2-A of the Act is a break in service of the employee for the purpose of gratuity.
Every establishment falling within the ambit of Section 1(3) of the PG Act, 1972 has to follow it irrespective of its sectoral classification.
From India, Salem
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In the context of the Payment of Gratuity Act, 1972, break in service refers to the period during which the continuity of the service of an employee stands snapped while still the contract of employment between the employer and the employee subsists. In other words, any period of interruptions in service other than those deemed to be non-interruptions under Section 2-A of the Act is a break in service of the employee for the purpose of gratuity.
Every establishment falling within the ambit of Section 1(3) of the PG Act, 1972 has to follow it irrespective of its sectoral classification.
From India, Salem
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Dear Prashant ji,
While appreciating the reply by Umakanthan Sir to your query, I would just like to add the following:
The definition of 'Continuous Service' was introduced by the insertion of an independent section 2-A through an amendment in 1984 (effective from 1981), following the Honorable Supreme Court judgment in Lalappa Lingappa (1981 I LLJ 308). In this judgment, it was held that permanent employees were not entitled to payment of Gratuity for years in which they remained absent without leave and had actually worked for less than 240 days in a year. Additionally, it was stated that badli employees were not covered by the substantive part but fell within the existing explanation 'I' at that time, and therefore were not entitled to payment of Gratuity for the badli period, i.e., for years in which no work was assigned to them due to their failure to report to duty.
To address the hardships resulting from the Supreme Court ruling and to grant the right of payment of Gratuity to badli workers and others who worked for 240 days or more in a year/years, the Parliament re-enacted the definition of 'Continuous Service' through an independent section 2-A.
From India, Mumbai
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While appreciating the reply by Umakanthan Sir to your query, I would just like to add the following:
The definition of 'Continuous Service' was introduced by the insertion of an independent section 2-A through an amendment in 1984 (effective from 1981), following the Honorable Supreme Court judgment in Lalappa Lingappa (1981 I LLJ 308). In this judgment, it was held that permanent employees were not entitled to payment of Gratuity for years in which they remained absent without leave and had actually worked for less than 240 days in a year. Additionally, it was stated that badli employees were not covered by the substantive part but fell within the existing explanation 'I' at that time, and therefore were not entitled to payment of Gratuity for the badli period, i.e., for years in which no work was assigned to them due to their failure to report to duty.
To address the hardships resulting from the Supreme Court ruling and to grant the right of payment of Gratuity to badli workers and others who worked for 240 days or more in a year/years, the Parliament re-enacted the definition of 'Continuous Service' through an independent section 2-A.
From India, Mumbai
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In continuation of what Umakanthan Sir and Korgaonkarji have said, I would also like to add that concerning employees of establishments which operate 5 days a week, the minimum number of days for continuous service is 190. This rule applies to employees working below the ground of a mine, even if the mine operates for 6 days a week. Additionally, this 240/190 days, as the case may be, includes all paid holidays, weekly off days, leave days, and even the days when the employee was on leave without pay following any employment injury.
It's important to note that we will not provide wages to an employee covered by ESI when they take leave due to an accident. However, these days will not interrupt their service. On the other hand, any loss of pay leave that is not regularized later, even as LOP days, will be considered an interruption of service. This aspect was also discussed in the Lalappa case mentioned above.
Madhu T K
From India, Kannur
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It's important to note that we will not provide wages to an employee covered by ESI when they take leave due to an accident. However, these days will not interrupt their service. On the other hand, any loss of pay leave that is not regularized later, even as LOP days, will be considered an interruption of service. This aspect was also discussed in the Lalappa case mentioned above.
Madhu T K
From India, Kannur
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Dear Sirs,
With regard to the above topics, I just need your thoughts on the following. I worked for ABC company for one year, resigned, joined XYZ company, and then returned to work with ABC company for four years. Now, having worked for a total of five years, am I entitled to gratuity or not?
From India, New Delhi
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With regard to the above topics, I just need your thoughts on the following. I worked for ABC company for one year, resigned, joined XYZ company, and then returned to work with ABC company for four years. Now, having worked for a total of five years, am I entitled to gratuity or not?
From India, New Delhi
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Your date of rejoining the service is the date of joining, and the present service cannot be claimed as a continuation of your previous service. When you rejoined the service, you should have received a new appointment order. Based on that, you joined the company for your second tenure, and thus, there is no possibility of combining it with your previous service. However, if any mistakes were made by the HR due to ignorance, it is possible to rectify them.
I would not advise you to take advantage of any errors made by the HR. If your rejoining was facilitated by a mistake, it would be unfair to exploit the situation. It seems you joined the company again after realizing that the initial job did not meet your expectations.
Madhu T K
From India, Kannur
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I would not advise you to take advantage of any errors made by the HR. If your rejoining was facilitated by a mistake, it would be unfair to exploit the situation. It seems you joined the company again after realizing that the initial job did not meet your expectations.
Madhu T K
From India, Kannur
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