Gratuity is given by an employer to employees for the service rendered by the employee to his/her employer for a continuous period of 5 years (minimum 5 years and count further).
In your case, the employee in question worked with Agency A for 3 years and Agency B for 2 years. This employee never worked with any of the employers for a "continuous period of 5 years." Employer, in simple terms, with whom the employee has an employment contract, i.e., here on the payrolls of Agency A for 3 years and B for 2 years. Principal Employer is liable to pay certain payments like salary and other statutory payments, only in case the contractor fails to meet commitments to his employee, not gratuity as it is an award for long-term service.
In short, in your case, company X is not liable to pay gratuity.
Suresh
From India, Pune
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71In your case, the employee in question worked with Agency A for 3 years and Agency B for 2 years. This employee never worked with any of the employers for a "continuous period of 5 years." Employer, in simple terms, with whom the employee has an employment contract, i.e., here on the payrolls of Agency A for 3 years and B for 2 years. Principal Employer is liable to pay certain payments like salary and other statutory payments, only in case the contractor fails to meet commitments to his employee, not gratuity as it is an award for long-term service.
In short, in your case, company X is not liable to pay gratuity.
Suresh
From India, Pune
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Hi, I am Jitendra. I am working on the payroll of India's famous Chennai-based staffing company, **HR Solution Pvt Ltd, deputed by an MNC Company as a creative desk for the last 6 years without any break. So, am I eligible for any gratuity benefit as per the new Labour Law 2021? Please ask me.
From India, Manda
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From India, Manda
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Payment of Gratuity Act, 1972 & The Rules.ppt
THE PAYMENT OF GRATUITY ACT 1972.doc