Hello Mr. Sinha,
I would like to thank you for updating me on my query. Also would like to thanks to you,Mr. Madhu T.K. and Mr.Raj Kumar for putting their valuable inputs in making aware to all about the actual fact of Gratuity.
Here again i am in need of certian details about the gratuity.It will be great if some one will assist me in gathering the information.
We have started our organization in the month of Feb,2006 and we are running our company with the employee strength of 70 to 80 employees.Now I feel that we have to take a step of implementing the policy of gratuity in our organization.
I would like to have detail information from you all for impleteing this policy in my organization.Please make me aware for all the steps and all the actions that i have to take to follow the policy of Gratuity.
Thanks once again to every body for such cooperation.
Smita
From India, Mumbai
I would like to thank you for updating me on my query. Also would like to thanks to you,Mr. Madhu T.K. and Mr.Raj Kumar for putting their valuable inputs in making aware to all about the actual fact of Gratuity.
Here again i am in need of certian details about the gratuity.It will be great if some one will assist me in gathering the information.
We have started our organization in the month of Feb,2006 and we are running our company with the employee strength of 70 to 80 employees.Now I feel that we have to take a step of implementing the policy of gratuity in our organization.
I would like to have detail information from you all for impleteing this policy in my organization.Please make me aware for all the steps and all the actions that i have to take to follow the policy of Gratuity.
Thanks once again to every body for such cooperation.
Smita
From India, Mumbai
I don't think that you may require any more updation about gratuity. sice your establishment is covered by Payment of Gratuity Act you have to follow the provisions of the said Act.
Accordingly, you have to collect nominations from all employees who have completed at least one year of service in form F and file it with you (no need to send it to any department)
Whenever an employee leaves calculate and pay the gratuity. Gratuity will be an amount equal to 15 days pay for every completed year of service. Any fraction of a year more than six months shall be taken as one year and less than six months shall be ignored. The maximum gratuity payable as per Act is Rs 10 lakhs. Average rate of wages is calculated by dividing last drawn monthly salary (Basic and Dearness allowance) by 26.
When an employee leaves collect a gratuity claim application form (Form I) and pay the amount within 30 days. Remember payment of gratuity within 30 days is legal obligation of the employer. Therefore, if the left employee is not traceable the employer should deposit the amount with the appropriate authority under the Act (Labour Deptt) within that period (30 days) Before that send letter in form L calling on the employee to come and collect the amount on a specified date. This will absolve the employer's liability. Otherwise he has to pay interest.
Regards,
Madhu.T.K
From India, Kannur
4249Accordingly, you have to collect nominations from all employees who have completed at least one year of service in form F and file it with you (no need to send it to any department)
Whenever an employee leaves calculate and pay the gratuity. Gratuity will be an amount equal to 15 days pay for every completed year of service. Any fraction of a year more than six months shall be taken as one year and less than six months shall be ignored. The maximum gratuity payable as per Act is Rs 10 lakhs. Average rate of wages is calculated by dividing last drawn monthly salary (Basic and Dearness allowance) by 26.
When an employee leaves collect a gratuity claim application form (Form I) and pay the amount within 30 days. Remember payment of gratuity within 30 days is legal obligation of the employer. Therefore, if the left employee is not traceable the employer should deposit the amount with the appropriate authority under the Act (Labour Deptt) within that period (30 days) Before that send letter in form L calling on the employee to come and collect the amount on a specified date. This will absolve the employer's liability. Otherwise he has to pay interest.
Regards,
Madhu.T.K
From India, Kannur
DEar Mr. MAdhu,
One more query.
I have offered a supervisory post in a good and brand hospital in mumbai. My CTC is 18,000 per month out of which 14,000 would be cash in hand.
Out of this 4000 - PF (both side), LTA, Gratuity will be deducted.
So is this right, the company is deducting the gratuity from employees salary and incase by any chance I leave org before five years, then what about gratuity amount as they deducting it from my payment.
FYI-Ihave not signed the offer yet.
From India, Mumbai
One more query.
I have offered a supervisory post in a good and brand hospital in mumbai. My CTC is 18,000 per month out of which 14,000 would be cash in hand.
Out of this 4000 - PF (both side), LTA, Gratuity will be deducted.
So is this right, the company is deducting the gratuity from employees salary and incase by any chance I leave org before five years, then what about gratuity amount as they deducting it from my payment.
FYI-Ihave not signed the offer yet.
From India, Mumbai
Thank you for the updates mr. Madhu.
But i would like to tell you we have not covered our establishment in to payment of gratuity as yet.
we are not showing any gratuity in to CTC letters nor we are making any provision for this in to our balancesheet.
I am planning to impleament this now onwards in to my organisation.
So we are just in the start procedure and i want to know how we can go with this.
lot of question i have like do i need to register in to any gratuity act, do i need to reflect the same in balancesheet, do i need to inform ROC, do i need to impleament all this in to compant policy manual, etc......
From India, Mumbai
But i would like to tell you we have not covered our establishment in to payment of gratuity as yet.
we are not showing any gratuity in to CTC letters nor we are making any provision for this in to our balancesheet.
I am planning to impleament this now onwards in to my organisation.
So we are just in the start procedure and i want to know how we can go with this.
lot of question i have like do i need to register in to any gratuity act, do i need to reflect the same in balancesheet, do i need to inform ROC, do i need to impleament all this in to compant policy manual, etc......
From India, Mumbai
Dear Smita,
To start with: (step wise)
1.) Your organization should obtain an insurance, for its liability towards the payment of gratuity under the Payment of Gratuity Act, from the LIC or any other insurance company.
2.) or your organization can established its own approved gratuity fund for its liability towards the payment of gratuity.
3.) A notice in Form A (regarding the implementaion of the Act) should be submitted by your organization to the controlling authority of your area.
4.) Nomination of all covered employees in Form F should we submitted to the controlling authority.
Yes...the paid contribution amount towards the gratuity fund and fund value should reflect in the balance sheet.
No need to inform the ROC.
regards,
Kamal
From India, Pune
To start with: (step wise)
1.) Your organization should obtain an insurance, for its liability towards the payment of gratuity under the Payment of Gratuity Act, from the LIC or any other insurance company.
2.) or your organization can established its own approved gratuity fund for its liability towards the payment of gratuity.
3.) A notice in Form A (regarding the implementaion of the Act) should be submitted by your organization to the controlling authority of your area.
4.) Nomination of all covered employees in Form F should we submitted to the controlling authority.
Yes...the paid contribution amount towards the gratuity fund and fund value should reflect in the balance sheet.
No need to inform the ROC.
regards,
Kamal
From India, Pune
Dear Yasmin,
As you have mentioned 18K is your CTC and not your monthly gross salary. So showing gratuity contribution as one of the CTC component is not a deduction from your salary.
CTC is what the company is spending on you. There is nothing wrong if PF contribution, LTA, Gratuity contribution etc. are mentioned as components of CTC.
regards,
Kamal
From India, Pune
As you have mentioned 18K is your CTC and not your monthly gross salary. So showing gratuity contribution as one of the CTC component is not a deduction from your salary.
CTC is what the company is spending on you. There is nothing wrong if PF contribution, LTA, Gratuity contribution etc. are mentioned as components of CTC.
regards,
Kamal
From India, Pune
Dear Kamal,
But the gratuity is the employer showing gratitude towards employee for his dedication for long term of service.
If I leave Job in 1 year, then what ? the company will not give me my own money?
From India, Mumbai
But the gratuity is the employer showing gratitude towards employee for his dedication for long term of service.
If I leave Job in 1 year, then what ? the company will not give me my own money?
From India, Mumbai
Your apprehensions are genuine. Gratuity is not a part of salary. Since it is payable only when an employee leaves and the amount of gratuity will depend on the salary the employee will earn at the time of his leaving and whereas the date of leaving is not known in advance, how would you calculate gratuity right at the time of joining? How can you say that X amount would be gratuity and that would be cost to company? If the entire costs to be incurred by nature of an employment should be CTC, then it is better to add the electricity costs (because an employee must be using fans or AC), paper and stationery costs, depreciation of chairs etc to CTC forgetting the work done or rather the benefits which the company gets out of his employment.
Read the following also
Madhu.T.K: CTC Vs BTC
Madhu.T.K
From India, Kannur
Read the following also
Madhu.T.K: CTC Vs BTC
Madhu.T.K
From India, Kannur
Dear Mr. Madhu,
Thanks for your input, this is the thing which I wanted to clarify, I will try to make them understand what gratuity stands for. How could they predict the future ?
I am not willing to leave the job early but incase due to some unavoidable reoson it can happen with anyone, then they gulp the gratuity amount saying you are not eligible for it.
From India, Mumbai
Thanks for your input, this is the thing which I wanted to clarify, I will try to make them understand what gratuity stands for. How could they predict the future ?
I am not willing to leave the job early but incase due to some unavoidable reoson it can happen with anyone, then they gulp the gratuity amount saying you are not eligible for it.
From India, Mumbai
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