Hi, according to the rule, one can avail gratuity after attaining 5 yrs of service in a company, i would like to know what happens to the amount that has been deducted as gratuity if a person leaves the company within 5 years. does the amount goes to govt. or to the company itself.
Regards,
Arun
From India, Mumbai
Regards,
Arun
From India, Mumbai
Hey,
Gratuity is not a part of salary or wage but by virtue of Payment of Gratuity act as it is a law all employers are legaly bound to pay it. There is no such deduction for gratuity. It is a extra financial burden on the part of employer. Although employers while negotiating salary highlight the amount of gratuity payable this is in case of the employee completes five years continuous service with the employer.
R.K.P
Gratuity is not a part of salary or wage but by virtue of Payment of Gratuity act as it is a law all employers are legaly bound to pay it. There is no such deduction for gratuity. It is a extra financial burden on the part of employer. Although employers while negotiating salary highlight the amount of gratuity payable this is in case of the employee completes five years continuous service with the employer.
R.K.P
Hi Arun,
The gratuity amount is not deducted from your monthly salary.
After you complete 4.5 years of continuous service with an establishment . The company is liable to pay the amt. toward your gratuity.
The amt. is paid after you resign from the job. The amt. is paid with the full and final settlement done
The calculation is as under:
Basic+DA * 15/26.
Regards,
Binoy
From India, Bangalore
3The gratuity amount is not deducted from your monthly salary.
After you complete 4.5 years of continuous service with an establishment . The company is liable to pay the amt. toward your gratuity.
The amt. is paid after you resign from the job. The amt. is paid with the full and final settlement done
The calculation is as under:
Basic+DA * 15/26.
Regards,
Binoy
From India, Bangalore
Hi Binoy,
A little change to the formula you have given for the calculation of gratuity:
Last drawn basic + DA * 15/26 * no of years of service
Also to reply to Arun's query (correct me if I am wrong!!)
The amount of gratuity is usually added into the CTC of an employee by an employer. This is calculated on the basic salary of the employee and as the basic salary increases the amount of gratuity also increases. The gratuity amount is kept aside either in a Gratuity Trust maintained by the company or with LIC (ususally done) or with a private company giving the same service.
If an employee leaves the organisation before the tenure of 5 years he/she is not eligible for the amount and the amount is kept in the fund - I don't think the amount goes to the govt or the organisation.
Hope this little gyaan I know helps u!! :)
Chanchal
From India, Mumbai
A little change to the formula you have given for the calculation of gratuity:
Last drawn basic + DA * 15/26 * no of years of service
Also to reply to Arun's query (correct me if I am wrong!!)
The amount of gratuity is usually added into the CTC of an employee by an employer. This is calculated on the basic salary of the employee and as the basic salary increases the amount of gratuity also increases. The gratuity amount is kept aside either in a Gratuity Trust maintained by the company or with LIC (ususally done) or with a private company giving the same service.
If an employee leaves the organisation before the tenure of 5 years he/she is not eligible for the amount and the amount is kept in the fund - I don't think the amount goes to the govt or the organisation.
Hope this little gyaan I know helps u!! :)
Chanchal
From India, Mumbai
Dear Sender,
Mr. Binoy statement about service terms is wrong.
The gratuity is statutory payment for security after service. For eligiblity, minimum 5 years of service need to rendered during employment. This will pay only after leaving the employment and pay in final dues.
The gratuity calculation formula - (Basic+DA)/26*15*no. of service rendered.
Some cos. added into CTC package.
There will be no deduction / recovery from gratuity payment. This will borned by Employer only.
regs,
Bhushan Dahanukar
From India, Mumbai
Mr. Binoy statement about service terms is wrong.
The gratuity is statutory payment for security after service. For eligiblity, minimum 5 years of service need to rendered during employment. This will pay only after leaving the employment and pay in final dues.
The gratuity calculation formula - (Basic+DA)/26*15*no. of service rendered.
Some cos. added into CTC package.
There will be no deduction / recovery from gratuity payment. This will borned by Employer only.
regs,
Bhushan Dahanukar
From India, Mumbai
Hey Yazmeen, In the formula for gratuity 15 depicts "half a month" and 26 depicts the "number of working days in a month (excluding the 4 sundays)" Hope this answers your query! Chanchal
From India, Mumbai
From India, Mumbai
Guys,
There was a mistake in my calculation for the eligibility to attain the gratuity amt.
Normally a person is eligible for gratuity after 4.8years.The figure 5 is a round-off period that is shown in the books.
Well the employee is eligible to get his gratuity only after he/she leaves the job.
Regards,
Binoy Babu :wink:
From India, Bangalore
There was a mistake in my calculation for the eligibility to attain the gratuity amt.
Normally a person is eligible for gratuity after 4.8years.The figure 5 is a round-off period that is shown in the books.
Well the employee is eligible to get his gratuity only after he/she leaves the job.
Regards,
Binoy Babu :wink:
From India, Bangalore
Dear friends
The Payment of Gratuity Act 1972 section 4 says that the employee should be paid gratuity on the termination of his employment after he has rendered continuous service for not less than five years,on his superannuation, or on his retirement or resignation; or on his death or disablement due to accident or disease.
In this connection the following points should bare in mind:-
a) Completion of continuous service of five years is not necessary where the termination of service is on account of death or disablement of the employee.
Hence 4.8 years of service is not eligible for getting gratuity
regards
09442637009
From India, Madras
The Payment of Gratuity Act 1972 section 4 says that the employee should be paid gratuity on the termination of his employment after he has rendered continuous service for not less than five years,on his superannuation, or on his retirement or resignation; or on his death or disablement due to accident or disease.
In this connection the following points should bare in mind:-
a) Completion of continuous service of five years is not necessary where the termination of service is on account of death or disablement of the employee.
Hence 4.8 years of service is not eligible for getting gratuity
regards
09442637009
From India, Madras
Dear Arun,
Gratuity is not deducted every month from the employer. It is provided to the Gratuity Fund created by the trust ( Either managed by the Trust directly or by Institutions like LIC).
The Gratuity will be provided from the forst year of confirmed service. However an employee will be elgigble for Gratuity payments only when he completes 5 years of Service.
- Regards- Balaji
From India, Coimbatore
Gratuity is not deducted every month from the employer. It is provided to the Gratuity Fund created by the trust ( Either managed by the Trust directly or by Institutions like LIC).
The Gratuity will be provided from the forst year of confirmed service. However an employee will be elgigble for Gratuity payments only when he completes 5 years of Service.
- Regards- Balaji
From India, Coimbatore
Hi everyone
Sorry to sound lame ..... but it'd really help to have someone draw out a sample calculation for Gratuity.
Say I have a Last Drawn Basic of 10,000 and am planning to leave job having completed 5 years .... wat ballpark estimate of Gratuity can I expect?
P.S: It luks a cool site with tons I ppl I should like to meet up and know more from. Wonder why I couldn't find it before.
From India, Mumbai
Sorry to sound lame ..... but it'd really help to have someone draw out a sample calculation for Gratuity.
Say I have a Last Drawn Basic of 10,000 and am planning to leave job having completed 5 years .... wat ballpark estimate of Gratuity can I expect?
P.S: It luks a cool site with tons I ppl I should like to meet up and know more from. Wonder why I couldn't find it before.
From India, Mumbai
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