An employee involved in fraud activity, and we have filed an FIR against the employee. Management has decided not to pay the F&F and Gratuity. Is it possible to hold the gratuity and F&F, or will it create any legal issues?
From India, Bellary
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From India, Bellary
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Dear Venkatesh,
Please refer to section 4(6) of the Payment of Gratuity Act, 1972.
Registration of an FIR by the police against an employee alleged to have committed an act of fraud against the organization simply cannot be a reason for withholding his statutory gratuity. It should be consequent on the employee's dismissal order after conviction by the court or as a result of a domestic enquiry simultaneously and independently conducted in this regard by the employer.
From India, Salem
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6185Please refer to section 4(6) of the Payment of Gratuity Act, 1972.
Registration of an FIR by the police against an employee alleged to have committed an act of fraud against the organization simply cannot be a reason for withholding his statutory gratuity. It should be consequent on the employee's dismissal order after conviction by the court or as a result of a domestic enquiry simultaneously and independently conducted in this regard by the employer.
From India, Salem
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First of all, the retirement of the employee, particularly as the misconduct alleged is fraud, has to be subject to such action as per rules depending on the outcome of the disciplinary action. You can withhold gratuity until the decision of the departmental inquiry by issuing a specific order to that effect and subject to the provision that in case the employee is exonerated of the charges, he shall be paid gratuity along with interest as notified (10% simple interest).
From India, Mumbai
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From India, Mumbai
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To my knowledge, the Payment of Gratuity Act does not provide for withholding gratuity. The provisions of Section 4(6) of the Payment of Gratuity Act only deal with forfeiture, not withholding gratuity. This could be invoked only on the strength of an order of termination of the employee consequent to his conviction in a criminal case or the findings in a Departmental Proceedings.
From India, Kochi
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From India, Kochi
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