Dear All,
I have learnt through sources that according to a judgement from the Supreme Court of India, any employee who has completed 4 years 8 months of service (in other words has completed 240 days in the 4th year) is eligible for payment of gratuity.
Is this true? If yes is there any documentation to this effect.
And another thing i would like to know that is eligible for any other private concern?
i am working in a Two wheeler Dealersip? But that management has deducted EPF & ESI in my salary.
Kindly Help me.....Pls
Regards
Venkey
From India, Pondicherry
3I have learnt through sources that according to a judgement from the Supreme Court of India, any employee who has completed 4 years 8 months of service (in other words has completed 240 days in the 4th year) is eligible for payment of gratuity.
Is this true? If yes is there any documentation to this effect.
And another thing i would like to know that is eligible for any other private concern?
i am working in a Two wheeler Dealersip? But that management has deducted EPF & ESI in my salary.
Kindly Help me.....Pls
Regards
Venkey
From India, Pondicherry
Mr. Venkey,
a. Continuous service of not less than 5 years is the minimum eligibility to get the gratuity. So what you have heard is absolutely is not correct.
b. Two wheeler dealership : The repair and maintenance activity shall automatically come under the definition of " manufacturing process ". So, your employer comes under the definition of factory provided 10 employees with the aid of power or 20 employees without the aid of power are engaged. Once your employer covered under the Factories Act, automatically the coverage under PF and ESI are must. As far as ESI is concenrned, the loaction of your organisation should come under its coverage jurisdiction.
regards
palani
From India, Tiruppur
a. Continuous service of not less than 5 years is the minimum eligibility to get the gratuity. So what you have heard is absolutely is not correct.
b. Two wheeler dealership : The repair and maintenance activity shall automatically come under the definition of " manufacturing process ". So, your employer comes under the definition of factory provided 10 employees with the aid of power or 20 employees without the aid of power are engaged. Once your employer covered under the Factories Act, automatically the coverage under PF and ESI are must. As far as ESI is concenrned, the loaction of your organisation should come under its coverage jurisdiction.
regards
palani
From India, Tiruppur
Mr. Venkey,
Greetings for the day,
Mr. Palani is correct that two wheeler dealership manages workshop where use of power is necessary so it should be covered under factory act and compliance for esi/pf is same as per act.
secondly eligiblity of gratuity 5 years continues service is necessary in each year the working day should be 240 days.
thanks & regards,
from,
sumit kumar saxena,
9899669071, 0120-4131277
From India, Ghaziabad
Greetings for the day,
Mr. Palani is correct that two wheeler dealership manages workshop where use of power is necessary so it should be covered under factory act and compliance for esi/pf is same as per act.
secondly eligiblity of gratuity 5 years continues service is necessary in each year the working day should be 240 days.
thanks & regards,
from,
sumit kumar saxena,
9899669071, 0120-4131277
From India, Ghaziabad
Mr.Venkey,
According to supreme court judgement, a person who works for more than 240 days in a year with out break in service shall be deemed as one year. So if an employee works for 4 years and 8 months with out break in service then he is eligble for Gratuity. Suprement court has given the judgement for the eligibility of gratuity for the employee who works for 4 years and 10 months.
Gratuity Act is applicable to an establishment where 10 or more employees employed on any day in the preceding twelve months.
Regards,
V Ravisankar
9500140244
According to supreme court judgement, a person who works for more than 240 days in a year with out break in service shall be deemed as one year. So if an employee works for 4 years and 8 months with out break in service then he is eligble for Gratuity. Suprement court has given the judgement for the eligibility of gratuity for the employee who works for 4 years and 10 months.
Gratuity Act is applicable to an establishment where 10 or more employees employed on any day in the preceding twelve months.
Regards,
V Ravisankar
9500140244
Dear Mr.Venkey
The Honourable Madras High Court had taken the view in Mettur Beardsell's case that a person is deemed to have worked for one year if he had worked for 240 days in that year and therefore if a person had worked for 4 years and 240 days he is deemed to have put in five years of continuous service and is thereforfe eligible for gratuity. Some body has uploaded this judgment in this website. If you search for it under the caption "gratutiy" probably you may get it. As far as my knowledge goes there is no Supreme Court decision on this point.
Regarding the second point the information given by you is not sufficient. Regarding this five types of situtations are possible. Firstly, if there is only sales at the place where you are working and there is no servicing of the vehicles, then the Factories Act will not apply and the Tamilnadu Shops and Establishments Act will apply. I have assumed that you are working in Neyveli. If ten or more persons are working in the dealership as of now, or, if during the twelve calendar months preceding the date on which gratuityu became payable, ten or more persons were working, the Payment of Gratuity Act is applicable to the dealership and the employees are entitled to gratuity according to the provisions of the Payment of Gratuity Act. Secondly if servicing of vehicles are also done in the dealership, then please check whether the employer is showing the service unit as a separate establishment or both the dealership and the service unit as one unit. If both are shown as separate units, please check in which establishment your name is included. If your name is in the dealership, then what I have said in the earlier portion of this post will apply. In case the servicing is shown as a separte unit and you are shown in the servicing unit please check whether any power is used for servicing work. Even if a quarter horse power motor is used that is sufficient. However if the servicing unit is to come within the definition of 'factory' as defined under the Factories Act at least ten persons should have been employed along with the use of power. If the number is less than ten and power is used then it is not a 'factory' and therefore the Factories Act will not apply.However you can claim that the Tamilnadu Shops and Establishments Act is applicable and on that basis claim gratuity. If no power is used in the service department and twenty or more persons are employed then the service unit becomes a 'factory' as defined under the Factories Act. Fourthly in the servicing unit if no power is used and less than twenty workmen are employed, the Factories Act will not apply. But you can contend that the Tamilnadu Shops and Establishments Act will apply and claim gratuity. Fifthly if the dealership and the service unit is shown as one establishment and power is used for servicing then the Factories Act would apply if ten or more persons are employed. Employees of establishments to which the Factories Act applies and employees of shops and establishments in which ten or more persons are(were) employed are entitled for gratuity.
From India, Madras
The Honourable Madras High Court had taken the view in Mettur Beardsell's case that a person is deemed to have worked for one year if he had worked for 240 days in that year and therefore if a person had worked for 4 years and 240 days he is deemed to have put in five years of continuous service and is thereforfe eligible for gratuity. Some body has uploaded this judgment in this website. If you search for it under the caption "gratutiy" probably you may get it. As far as my knowledge goes there is no Supreme Court decision on this point.
Regarding the second point the information given by you is not sufficient. Regarding this five types of situtations are possible. Firstly, if there is only sales at the place where you are working and there is no servicing of the vehicles, then the Factories Act will not apply and the Tamilnadu Shops and Establishments Act will apply. I have assumed that you are working in Neyveli. If ten or more persons are working in the dealership as of now, or, if during the twelve calendar months preceding the date on which gratuityu became payable, ten or more persons were working, the Payment of Gratuity Act is applicable to the dealership and the employees are entitled to gratuity according to the provisions of the Payment of Gratuity Act. Secondly if servicing of vehicles are also done in the dealership, then please check whether the employer is showing the service unit as a separate establishment or both the dealership and the service unit as one unit. If both are shown as separate units, please check in which establishment your name is included. If your name is in the dealership, then what I have said in the earlier portion of this post will apply. In case the servicing is shown as a separte unit and you are shown in the servicing unit please check whether any power is used for servicing work. Even if a quarter horse power motor is used that is sufficient. However if the servicing unit is to come within the definition of 'factory' as defined under the Factories Act at least ten persons should have been employed along with the use of power. If the number is less than ten and power is used then it is not a 'factory' and therefore the Factories Act will not apply.However you can claim that the Tamilnadu Shops and Establishments Act is applicable and on that basis claim gratuity. If no power is used in the service department and twenty or more persons are employed then the service unit becomes a 'factory' as defined under the Factories Act. Fourthly in the servicing unit if no power is used and less than twenty workmen are employed, the Factories Act will not apply. But you can contend that the Tamilnadu Shops and Establishments Act will apply and claim gratuity. Fifthly if the dealership and the service unit is shown as one establishment and power is used for servicing then the Factories Act would apply if ten or more persons are employed. Employees of establishments to which the Factories Act applies and employees of shops and establishments in which ten or more persons are(were) employed are entitled for gratuity.
From India, Madras
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Gratuity Eligibility.pdf
Gratuity eligibility for less than 5 yrs. (4yrs.240days). docx