Gratuity if I work 2 months in CONTRACT and then 4 year 10 month as EMPLOyee
7 months ago
Hi,
I joined one organisation on 5th November 2018 as a CONTRACT hire for 3 months. On completion of around 2 months they gave me EMPLOYEE OFFER and I joined as an employee in the same organisation on 1st Jan 2019. I resigned from the company few days back (15 Nov 2023) and my last working day is probably going to be 31st Oct 2023. Will I be eligible for GRATUITY?
Here are the concise details
1. I have been working in the same organisation from 5th Nov 2018 till now suppose my last working day is going to be 31st Oct 2023, will I be eligible for gratuity? Note that from 5th Nov 2018 to 31st Dec 2018 I have been working as a CONTRACT hire and then from 1st JAN 2019 as EMPLOYEE.
Thanks
Sujit
An employee should complete 5 complete years of service within the organization to be eligible for gratuity payment. However, this gratuity payment rule is not applicable in case of an employee’s death or disablement.
A.4years 240 days is enough for claiming gratuity.
"As per Madras High Court judgement in a case of Mettur Beardsell Limited [represented by its Personal Manager], Madras v/s Regional Labour Commissioner [Central Authority under the Payment of Gratuity Act, 1972], Madras, it has been stated that if an employee has rendered continuous service of 240 days in the fifth year of service then for the purpose of calculation of gratuity, it must be considered as if he has completed FIVE years of continuous service.
With the enactment of the Payment of Gratuity Act, 1972, gratuity payment has become mandatory for the establishment where it is applicable. A gratuity must be paid to an employee upon cessation of employment if he or she has rendered continuous service for five years or more, according to Section 4(1) of the Payment of Gratuity Act of 1972. Section 4(2) of the Act provides that for every completed year of service or part thereof in excess of 6 months, the employer shall pay gratuity to an employee at the prescribed rates. According to section 2A of the Act, an employee is said to be in continuous service for a period if he has for that period been in uninterrupted service including service which may be interrupted on account of accident, sickness, leave, absence from duty without leave, layoff, strike or a lock-out or cessation of work not due to any fault of employee. The Madras High Court in Salem Textile Case had held that an employee who has completed 4 years and 240 days is eligible for gratuity. In view of the above proposition of law, when you rendered uninterrupted and continuous service for 5 years in an establishment including your contractual period, you are eligible for payment of gratuity from your employer.
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