An employee resigns from service after completion of 21 years 1 month. During his service he was absent continuously for 01 year 07 months due to his personal reasons and no salary paid for this period. In this case how we can calculate Gratuity.
Date of joining : 09.06.1997
Date of resignation : 06.07.2018
Date of relieving : 11.07.2018
Absented himself without leave (without pay): 24.11.2016 to 11.07.2018
Total years of service = 09.06.2018 – 23.11.2016 =19 Year minus - continuous absent period
Is it correct paying gratuity for 19 years?
Sir, your immediate advice is very helpful.
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2Date of joining : 09.06.1997
Date of resignation : 06.07.2018
Date of relieving : 11.07.2018
Absented himself without leave (without pay): 24.11.2016 to 11.07.2018
Total years of service = 09.06.2018 – 23.11.2016 =19 Year minus - continuous absent period
Is it correct paying gratuity for 19 years?
Sir, your immediate advice is very helpful.
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I think an absence of more than a year without pay may be considered as a service break, and the period will count afresh from his rejoining the job. However, it depends on the circumstances of the leave and how it was sanctioned.
From India, Mumbai
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From India, Mumbai
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Dear Srivastava,
Clarity is needed on how his leave was accounted for over one year and an odd period. What has the management done for his case, as he was not paid any remuneration/salary for such a period? His gratuity should be paid for the total period if he was considered to be on paid leave. However, you should have considered his case as a new joiner after that long leave and settled his amount then.
From India, Hyderabad
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Clarity is needed on how his leave was accounted for over one year and an odd period. What has the management done for his case, as he was not paid any remuneration/salary for such a period? His gratuity should be paid for the total period if he was considered to be on paid leave. However, you should have considered his case as a new joiner after that long leave and settled his amount then.
From India, Hyderabad
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(Fact Check Failed/Partial)-The user reply is partially correct. The payment of gratuity should be based on the total years of service excluding the period of continuous absence without leave and pay. There is no provision for treating the employee as a new joinee after such a long absence. The gratuity should be calculated based on the actual years of service rendered.
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Dear colleague,
During the total service period of 21 years and one month, the concerned employee was unavailable for work due to absence for a consecutive period of one year and seven months. Therefore, your decision to consider him eligible for gratuity for 19 years is correct.
Regards,
Vinayak Nagarkar
HR Consultant
From India, Mumbai
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During the total service period of 21 years and one month, the concerned employee was unavailable for work due to absence for a consecutive period of one year and seven months. Therefore, your decision to consider him eligible for gratuity for 19 years is correct.
Regards,
Vinayak Nagarkar
HR Consultant
From India, Mumbai
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(Fact Check Failed/Partial)-The user reply is incorrect. The calculation for gratuity should be based on the total years of service which is 21 years and 1 month, not 19 years.
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Dear Mr. Srivastava,
Continuity of service of an employee is calculated keeping in view the provision of Section 2A of the Payment of Gratuity Act, 1972. According to this section, an employee renders uninterrupted service even if his service is interrupted by sickness, accident, absence from duty with or without leave, lay-off, strike, or lock-out, or cessation of work not due to the fault of the employee.
However, if in respect of his unauthorized absence, an order has been passed by the management, in accordance with the Standing Orders, rules, or regulations governing the employee of the establishment, treating his absence as a break in service, then the period covered under such order shall not be considered towards his continuous service and thus shall be liable to be deducted from his total service period.
It means that even though your employee was on unauthorized leave and even though you have not paid him any salary, his service would be counted towards continuous service unless you have passed an order whereby his unauthorized absence was treated as a break in service.
Best wishes, Regards
From India, Chandigarh
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Continuity of service of an employee is calculated keeping in view the provision of Section 2A of the Payment of Gratuity Act, 1972. According to this section, an employee renders uninterrupted service even if his service is interrupted by sickness, accident, absence from duty with or without leave, lay-off, strike, or lock-out, or cessation of work not due to the fault of the employee.
However, if in respect of his unauthorized absence, an order has been passed by the management, in accordance with the Standing Orders, rules, or regulations governing the employee of the establishment, treating his absence as a break in service, then the period covered under such order shall not be considered towards his continuous service and thus shall be liable to be deducted from his total service period.
It means that even though your employee was on unauthorized leave and even though you have not paid him any salary, his service would be counted towards continuous service unless you have passed an order whereby his unauthorized absence was treated as a break in service.
Best wishes, Regards
From India, Chandigarh
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(Fact Checked)-The user's reply is correct. The information provided aligns with Section 2A of the Payment of Gratuity Act, 1972, which states that certain absences do not break continuous service unless specifically treated as such by the employer. (1 Acknowledge point)
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I think the contention of Jpratap Sir is quite reasonable. If management has not taken any action against the absentee in writing or passed any order, then the period of absence should be considered or counted as continuous service for the calculation of gratuity.
From India, Koraput
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From India, Koraput
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(Fact Check Failed/Partial)-The user reply is incorrect as per the Payment of Gratuity Act, 1972. Continuous absence without leave does not count as continuous service for gratuity calculation.
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When an employee is absent for a longer period, say six months or one year, and no action is taken against him by the employer, then such absence will not constitute a break in service. However, if a specific order is issued stating that his period of absence will be treated as a break in service, then it will be construed as a break in service. In such a case, he should have worked for 240 days to become eligible for gratuity.
From India, Bengaluru
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From India, Bengaluru
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(Fact Check Failed/Partial)-The user reply is partially correct. The absence period does not count towards service for gratuity unless specified in company policy or an order. However, the eligibility requirement is working for 240 days in the year preceding the termination.
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Payment of Gratuity Act, 1972 & The Rules.ppt
THE PAYMENT OF GRATUITY ACT 1972.doc
CiteHR.AI
(Fact Check Failed/Partial)-The user reply is partially correct. The absence without pay does not break the continuity of service for gratuity calculation, as per the Payment of Gratuity Act, 1972. The total years of service should be calculated including the absent period.