An employee in a company had served for 6 years and had resigned from the organization after serving for 6 years in 2011. The company had sent him a notice asking him to resume the job; otherwise, the job would be terminated, and accordingly, the job of that person was terminated. However, the gratuity remains unpaid to that person. In this case, what would be the implications or liability for non-payment of gratuity?
From India, Mumbai
Acknowledge(0)
Amend(0)
From India, Mumbai
Acknowledge(0)Amend(0)
Hello,
The Payment of Gratuity Act does not authorize an employer to withhold gratuity from an employee for any reason, such as negligence or unauthorized leave, except in cases where the employee's services are terminated due to willful omission or negligence that results in damage, loss, or destruction of the employer's property, riotous or disorderly behavior, or any act involving moral turpitude committed during employment.
In case an employer fails to pay gratuity, they may face the following consequences: imprisonment for a term of not less than 3 months and up to 1 year, or a fine ranging from Rs. 10,000 to Rs. 20,000, or both.
Arun J.
From India, Hyderabad
Acknowledge(0)Amend(0)
191The Payment of Gratuity Act does not authorize an employer to withhold gratuity from an employee for any reason, such as negligence or unauthorized leave, except in cases where the employee's services are terminated due to willful omission or negligence that results in damage, loss, or destruction of the employer's property, riotous or disorderly behavior, or any act involving moral turpitude committed during employment.
In case an employer fails to pay gratuity, they may face the following consequences: imprisonment for a term of not less than 3 months and up to 1 year, or a fine ranging from Rs. 10,000 to Rs. 20,000, or both.
Arun J.
From India, Hyderabad
Acknowledge(0)Amend(0)
The Employer is bound to pay the gratuity in the present case. no other option is available under the law.
From India, Pune
Acknowledge(0)Amend(0)
From India, Pune
Acknowledge(0)Amend(0)
Thank You sir for you reply Company is ready to pay but how and to whom to be paid as the employee is not approaching toward the company for his gratuity payment. Regards, Sonam
From India, Mumbai
Acknowledge(0)Amend(0)
From India, Mumbai
Acknowledge(0)Amend(0)
Dear Sonam,
The employee is eligible for gratuity, and the company needs to release the amount of gratuity. If the employee is not approaching the company, the company may send him a registered letter explaining the situation and the employee's benefit, and request him/her to receive his gratuity.
Regards,
Prabhat
From India, Mumbai
Acknowledge(0)Amend(0)
The employee is eligible for gratuity, and the company needs to release the amount of gratuity. If the employee is not approaching the company, the company may send him a registered letter explaining the situation and the employee's benefit, and request him/her to receive his gratuity.
Regards,
Prabhat
From India, Mumbai
Acknowledge(0)Amend(0)
I agree with Prabhat. Its Employers moral duty to intimate the employee about his gratuity. if he doesnot approach then deposit his graduity in his A/c.
From India, Hyderabad
Acknowledge(0)Amend(0)
From India, Hyderabad
Acknowledge(0)Amend(0)
Dear Members,
In my view, there is a provision in the act which states that the employee or his authorized representative/nominee has to apply to get the gratuity amount, and the employer has to pay it within the stipulated time (30 days) upon receipt of the application. This provision is detailed in "Section 7."
In normal circumstances, the employer pays it to the employees without even taking a formal application. However, in cases where the employee is absconding or in cases of death, it is in the interest of the employer to ensure proper documentation is completed before releasing any payments.
Regards,
Preetam Deshpande
From India, Mumbai
Acknowledge(0)Amend(0)
In my view, there is a provision in the act which states that the employee or his authorized representative/nominee has to apply to get the gratuity amount, and the employer has to pay it within the stipulated time (30 days) upon receipt of the application. This provision is detailed in "Section 7."
In normal circumstances, the employer pays it to the employees without even taking a formal application. However, in cases where the employee is absconding or in cases of death, it is in the interest of the employer to ensure proper documentation is completed before releasing any payments.
Regards,
Preetam Deshpande
From India, Mumbai
Acknowledge(0)Amend(0)
Dear Sonam,
Gratuity is to be paid to the nominee only in the case of the death of the employee. If the employee is absconding, the employer cannot pay the gratuity to the nominee on its own. If the employee is not traceable and you have all proof of the same, then deposit the gratuity amount with the Controlling Authority. The Gratuity Act clearly provides an option to the employer of depositing the gratuity amount with the Controlling Authority in case of any dispute, including when there is a dispute 'as to the person entitled to receive the gratuity'. If you delay the matter, you will have to pay interest on the payable gratuity amount.
I hope your doubts are cleared.
Regards,
Kamal
From India, Pune
Acknowledge(0)Amend(0)
Gratuity is to be paid to the nominee only in the case of the death of the employee. If the employee is absconding, the employer cannot pay the gratuity to the nominee on its own. If the employee is not traceable and you have all proof of the same, then deposit the gratuity amount with the Controlling Authority. The Gratuity Act clearly provides an option to the employer of depositing the gratuity amount with the Controlling Authority in case of any dispute, including when there is a dispute 'as to the person entitled to receive the gratuity'. If you delay the matter, you will have to pay interest on the payable gratuity amount.
I hope your doubts are cleared.
Regards,
Kamal
From India, Pune
Acknowledge(0)Amend(0)
Hello,
Following are the provisions under the Payment of Gratuity Act, 1972, for non-payment of gratuity:
Penalties
(1) Whoever, for the purpose of avoiding any payment to be made by himself under this Act or of enabling any other person to avoid such payment, knowingly makes or causes to be made any false statement or false representation shall be punishable with imprisonment for a term which may extend to six months, or with a fine which may extend to 1[ten thousand rupees], or with both.
(2) An employer who contravenes or makes default in complying with any of the provisions of this Act or any rule or order made thereunder shall be punishable with imprisonment for a term 2[which shall not be less than three months but which may extend to one year, or with a fine which shall not be less than ten thousand rupees but which may extend to twenty thousand rupees, or with both]:
Provided that where the offense relates to non-payment of any gratuity payable under this Act, the employer shall be punishable with imprisonment for a term which shall not be less than six months but which may extend to two years unless the court trying the offense, for reasons to be recorded by it in writing, is of the opinion that a lesser term of imprisonment or the imposition of a fine would meet the ends of justice.
So, clear his gratuity payment as soon as possible.
[COLOR="Magenta"]
With Regards,
Vineet Deshmukh[/COLOR]
From India, Yavatmal
Acknowledge(0)Amend(0)
Following are the provisions under the Payment of Gratuity Act, 1972, for non-payment of gratuity:
Penalties
(1) Whoever, for the purpose of avoiding any payment to be made by himself under this Act or of enabling any other person to avoid such payment, knowingly makes or causes to be made any false statement or false representation shall be punishable with imprisonment for a term which may extend to six months, or with a fine which may extend to 1[ten thousand rupees], or with both.
(2) An employer who contravenes or makes default in complying with any of the provisions of this Act or any rule or order made thereunder shall be punishable with imprisonment for a term 2[which shall not be less than three months but which may extend to one year, or with a fine which shall not be less than ten thousand rupees but which may extend to twenty thousand rupees, or with both]:
Provided that where the offense relates to non-payment of any gratuity payable under this Act, the employer shall be punishable with imprisonment for a term which shall not be less than six months but which may extend to two years unless the court trying the offense, for reasons to be recorded by it in writing, is of the opinion that a lesser term of imprisonment or the imposition of a fine would meet the ends of justice.
So, clear his gratuity payment as soon as possible.
[COLOR="Magenta"]
With Regards,
Vineet Deshmukh[/COLOR]
From India, Yavatmal
Acknowledge(0)Amend(0)
Dear Sonam,
I have seen the replies of senior members with various suggestions giving references to varied solutions besides penal provisions applicable in case of non-payment of gratuity under the Payment of Gratuity Act 1972. You are advised to take the following steps to obviate the blame for the non-payment of gratuity to the individual:
(i) Calculate the amount of gratuity payable to the individual and send a notice in the prescribed form to him, at the present and permanent addresses as recorded in his service book or available in any of the records, with a copy to the Controlling Authority of the Area specifying the amount of gratuity calculated.
(ii) Simultaneously write an application to the Controlling Authority of the Area showing your willingness to deposit the amount of gratuity in respect of the individual with the Authority or obtain permission for the delayed payment on the grounds that the individual has not claimed the gratuity amount, so that you receive immunity from paying interest on delayed gratuity payment later on.
(iii) As an extra precaution, you may display a copy of the notice on your notice board so that the word spreads to him through his colleagues.
BS Kalsi
Member since Aug 2011.
From India, Mumbai
Acknowledge(0)Amend(0)
I have seen the replies of senior members with various suggestions giving references to varied solutions besides penal provisions applicable in case of non-payment of gratuity under the Payment of Gratuity Act 1972. You are advised to take the following steps to obviate the blame for the non-payment of gratuity to the individual:
(i) Calculate the amount of gratuity payable to the individual and send a notice in the prescribed form to him, at the present and permanent addresses as recorded in his service book or available in any of the records, with a copy to the Controlling Authority of the Area specifying the amount of gratuity calculated.
(ii) Simultaneously write an application to the Controlling Authority of the Area showing your willingness to deposit the amount of gratuity in respect of the individual with the Authority or obtain permission for the delayed payment on the grounds that the individual has not claimed the gratuity amount, so that you receive immunity from paying interest on delayed gratuity payment later on.
(iii) As an extra precaution, you may display a copy of the notice on your notice board so that the word spreads to him through his colleagues.
BS Kalsi
Member since Aug 2011.
From India, Mumbai
Acknowledge(0)Amend(0)Engage with peers to discuss and resolve work and business challenges collaboratively - share and document your knowledge. Our AI-powered platform, features real-time fact-checking, peer reviews, and an extensive historical knowledge base. - Join & Be Part Of Our Community.
Employee Appraisal Form new.doc