Hi ,
one of my senior employees has come back to us for gratuity and i really don't have an idea on this.can anybody explain me in detail about the laws and how to calculate the gratuity...
Please help me in this..........
Thanks in advance
Riji
From India, Kochi
1one of my senior employees has come back to us for gratuity and i really don't have an idea on this.can anybody explain me in detail about the laws and how to calculate the gratuity...
Please help me in this..........
Thanks in advance
Riji
From India, Kochi
Dear Riji,
Eligibility:
* An employee should have completed 5 years of service in the organisation.
* If served one day less also the employee is not eligible for gratuity
* Over and above 5 years, less than six months is treated as zero and
more than six months is treated as 1 year
Gratuity calculation :
(Basic + DA + Personal pay) x 15 days
--------------------------------------------- x No. of years served
26 working days
Hope this is simple and clear.
Regards
Bharathi
Eligibility:
* An employee should have completed 5 years of service in the organisation.
* If served one day less also the employee is not eligible for gratuity
* Over and above 5 years, less than six months is treated as zero and
more than six months is treated as 1 year
Gratuity calculation :
(Basic + DA + Personal pay) x 15 days
--------------------------------------------- x No. of years served
26 working days
Hope this is simple and clear.
Regards
Bharathi
HI jaya/ riji
Only to add that gratuity period is calculated over 5 yrs for every completed year of service i.e. even if the employee has worked for 6 yrs and 11 months he will get gratuity for 6 yrs not seven yrs.
Rolly
From India, New Delhi
Only to add that gratuity period is calculated over 5 yrs for every completed year of service i.e. even if the employee has worked for 6 yrs and 11 months he will get gratuity for 6 yrs not seven yrs.
Rolly
From India, New Delhi
Hi,
There is no doubt Completion of Five years of service is compulsory for availing gratuity. But pls. go through Madras HC Judgement and below I am giving the abstract of the Same.
"Madras High Court, has held that an employee rendering continuous service for a period of 240 days in the 5th year, will be deemed to have continued in service for one year as stipulated by sec.2-A of the payment of Gratuity Act. In this case, the employee has put in his service for 10 months 18 days in the 5th year subsequent to 4th year, the Madras High Court has held that it will be treated as continuous five years of service and as such he will be entitled to gratuity"
For further details pls. go through March2004 Labour Law Reporter.
A.R.Ariraj
From India, Ghaziabad
There is no doubt Completion of Five years of service is compulsory for availing gratuity. But pls. go through Madras HC Judgement and below I am giving the abstract of the Same.
"Madras High Court, has held that an employee rendering continuous service for a period of 240 days in the 5th year, will be deemed to have continued in service for one year as stipulated by sec.2-A of the payment of Gratuity Act. In this case, the employee has put in his service for 10 months 18 days in the 5th year subsequent to 4th year, the Madras High Court has held that it will be treated as continuous five years of service and as such he will be entitled to gratuity"
For further details pls. go through March2004 Labour Law Reporter.
A.R.Ariraj
From India, Ghaziabad
Hi,
One of the conditions for availing Gratuity is 5 yrs. continuous service and not 5 completed years of service. If you see the definition of Continuous service it means completion of 240 days work in a year including the holidays. This in effect means if some one has put in 240 days in his/her 5th year he/she may jolly well make an application to the Management for claiming Gratuity.
Regards
Subrato
One of the conditions for availing Gratuity is 5 yrs. continuous service and not 5 completed years of service. If you see the definition of Continuous service it means completion of 240 days work in a year including the holidays. This in effect means if some one has put in 240 days in his/her 5th year he/she may jolly well make an application to the Management for claiming Gratuity.
Regards
Subrato
If employees completes 5 yrs and 6 months then the service year to be calculated as 6 yrs. Moreover I think in Gratuity calculation, no need to include personal pay. Only Basic + DA is enough.
Thanks
G Sakthi
Thanks
G Sakthi
Dear Rolly, After fivce years of service, 6 months and above will be treated as one year for calculating gratuity. Regards, SHAN
Dear Riji,
This very important question you have faced with.
You have to follow the following steps:
1. When the employee joins the orgs., please fill his gratuity nomination form, which G.L.O. will always asked for.
2. employee should have completed continuous service of 5 years in the organisation.
3. Over and above 5 years, less than six months is treated as zero and
more than six months is treated as 1 year
Gratuity calculation :
(Basic + DA + Personal pay) x 15 days
--------------------------------------------- x No. of years served
26 working days
Please feel free any querry if you have.
With Regards
Avinash K.
From India, Mumbai
This very important question you have faced with.
You have to follow the following steps:
1. When the employee joins the orgs., please fill his gratuity nomination form, which G.L.O. will always asked for.
2. employee should have completed continuous service of 5 years in the organisation.
3. Over and above 5 years, less than six months is treated as zero and
more than six months is treated as 1 year
Gratuity calculation :
(Basic + DA + Personal pay) x 15 days
--------------------------------------------- x No. of years served
26 working days
Please feel free any querry if you have.
With Regards
Avinash K.
From India, Mumbai
Community Support and Knowledge-base on business, career and organisational prospects and issues - Register and Log In to CiteHR and post your query, download formats and be part of a fostered community of professionals.
FORM-F-NOMINATI ON OF GRATUITY.pdf
Gratuity Form I.doc