Dear Mr. Korgaonkar,
I appreciate your immediate and sincere response with a copy of the proposed bill and thank you very much. Barring the Working Journalists (Conditions of Service & Miscellaneous Provisions) Act, 1955, there were no labor legislations incorporating gratuity as one of the service conditions, though the matter was receiving the attention of the Government of India as early as 1943, with a recommendation in this regard given by the Labor Investigation Committee. As usual, only the states of Kerala and West Bengal became the forerunners and passed their own State's Acts of Gratuity respectively in 1970 and 1971. Other states also seriously started to have their own laws on the subject. So, a compulsion for a common law applicable throughout the country arose, and the Central Government enacted this law in 1972.
Initially, the Act covered only those employees drawing wages (only basic + dearness allowance) up to Rs 750/= per month in factories, plantations, shops, establishments, and mines. The quantum of gratuity payable was fixed at 15 days of the last drawn wages. The maximum amount of gratuity was limited to 20 months of wages. Since then, the Act has been amended seven times in 1984, 1987, 1994, 1998, 2009, and 2010, incorporating periodic and drastic changes and modifications in its coverage, applicability, definition clauses, ceilings, etc.
Though I am as skeptical as you are about the bill's metamorphosis, it is a welcome effort by a people's representative, and if it comes to fruition, it will be of immense benefit to the working masses considering the galloping inflationary trend in the cost of living and changes in lifestyle.
From India, Salem
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6185I appreciate your immediate and sincere response with a copy of the proposed bill and thank you very much. Barring the Working Journalists (Conditions of Service & Miscellaneous Provisions) Act, 1955, there were no labor legislations incorporating gratuity as one of the service conditions, though the matter was receiving the attention of the Government of India as early as 1943, with a recommendation in this regard given by the Labor Investigation Committee. As usual, only the states of Kerala and West Bengal became the forerunners and passed their own State's Acts of Gratuity respectively in 1970 and 1971. Other states also seriously started to have their own laws on the subject. So, a compulsion for a common law applicable throughout the country arose, and the Central Government enacted this law in 1972.
Initially, the Act covered only those employees drawing wages (only basic + dearness allowance) up to Rs 750/= per month in factories, plantations, shops, establishments, and mines. The quantum of gratuity payable was fixed at 15 days of the last drawn wages. The maximum amount of gratuity was limited to 20 months of wages. Since then, the Act has been amended seven times in 1984, 1987, 1994, 1998, 2009, and 2010, incorporating periodic and drastic changes and modifications in its coverage, applicability, definition clauses, ceilings, etc.
Though I am as skeptical as you are about the bill's metamorphosis, it is a welcome effort by a people's representative, and if it comes to fruition, it will be of immense benefit to the working masses considering the galloping inflationary trend in the cost of living and changes in lifestyle.
From India, Salem
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Dear Ccbenzzz,
There is no need for an apology. We are all in the learning stage, and we learn from our mistakes. Please do not take my comments to heart. Read more and more. Make it a hobby. Make it a passion. Nowadays, you have so many sources to explore. Thanks for providing one of the sources to this forum, i.e. the link to PRS Legislative Research. Thanks again.
From India, Mumbai
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There is no need for an apology. We are all in the learning stage, and we learn from our mistakes. Please do not take my comments to heart. Read more and more. Make it a hobby. Make it a passion. Nowadays, you have so many sources to explore. Thanks for providing one of the sources to this forum, i.e. the link to PRS Legislative Research. Thanks again.
From India, Mumbai
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The limit of Gratuity is 10 lakhs. However, there is no restriction if the company wants to pay a higher amount as Gratuity to its employees. In such a case, the Income Tax benefit shall be restricted to Rs. 10 lakhs only, and the balance amount shall be taxable in the hands of the employee.
Further, the status of the proposed amendment to increase the calculation basis from 15 days to 30 days is still a proposal and has not yet been passed.
From India, New Delhi
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Further, the status of the proposed amendment to increase the calculation basis from 15 days to 30 days is still a proposal and has not yet been passed.
From India, New Delhi
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