• Graduity not paying

I worked for private limited company for 9years 6 months. They are denying to pay me graduity because they paid bonus. Is that right? If not what should I do?
Asked 5 years ago in Labour

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19 Answers

you can file a complaint under Section 8 of the act, against the company. 

Mohammed Mujeeb
Advocate, Hyderabad
19299 Answers
32 Consultations

4.7 on 5.0

Hello, 

It is a defined benefit, which means that the payment, based on a defined formula, will be guaranteed if the basic conditions are met. According to the Payment of Gratuity Act, 1972, gratuity is a benefit offered by organizations that employ more than 10 people. 

According to the law, an organization has to pay gratuity to an employee who has served it continuously for at least 5 years. For each year of service, it has to pay an amount equalling 15 days of last drawn salary. Salary here means basic salary plus dearness allowance and commission if the commission is a fixed percentage of sales. If a person has worked for over 6 months in the last year of service, it is considered as a complete year. For instance, if a person has 7 years and 6 months of continuous service, gratuity will be paid for 8 years. 

It is not related to a bonus at all. Bonus and Gratuity are completely different payments to be made by the company. The immediate remedy is filing a complaint approaching before Labour commissioner in Hyderabad, Telangana.

Prasaanth Bandaru
Advocate, Hyderabad
4 Answers
2 Consultations

4.9 on 5.0

No the gratuity is payable complaint before the labour commissioner for payment of the gratuity amount the local labour lawyer for same gratuity shall be payable to you.

Shubham Jhajharia
Advocate, Ahmedabad
25514 Answers
179 Consultations

5.0 on 5.0

If the amount of gratuity is not paid by the employer within the prescribed time to the said person, he/she has the right to file a complaint to the Controlling Authority under the Payment of Gratuity Act within the area where the employer's establishment is situated.

Siddharth Jain
Advocate, New Delhi
6303 Answers
102 Consultations

5.0 on 5.0

What was the basic salary and dearness allowance in your last drawn salary?

Siddharth Jain
Advocate, New Delhi
6303 Answers
102 Consultations

5.0 on 5.0

It should be calculated after all the deductions, i.e., on your net salary. It will be calculated all through your service, not only for a month. For 10 years it will be calculated in your case. Finally it will be amounted in lakhs.

Prasaanth Bandaru
Advocate, Hyderabad
4 Answers
2 Consultations

4.9 on 5.0

The gratuity amount depends upon the tenure of service and last drawn salary. It is calculated according to this formula: Last drawn salary (basic salary plus dearness allowance) X number of completed years of service X 15/26.

6 months or above that shall be calculated as year.

Shubham Jhajharia
Advocate, Ahmedabad
25514 Answers
179 Consultations

5.0 on 5.0

If no DA then only on basic.

Shubham Jhajharia
Advocate, Ahmedabad
25514 Answers
179 Consultations

5.0 on 5.0

The amount of gratuity can be calculated using the formula

Gratuity = n*b*15/26

Where n = tenure of service completed in the company

b = last drawn basic salary + dearness allowance. 

Mohammed Mujeeb
Advocate, Hyderabad
19299 Answers
32 Consultations

4.7 on 5.0

The amount of gratuity can be calculated using the following formula

Gratuity = n*b*15/26

Where n = tenure of service completed in the company

b = last drawn basic salary + dearness allowance

 

9.5 x 16000  x 15/26 = 87, 692/-

Siddharth Jain
Advocate, New Delhi
6303 Answers
102 Consultations

5.0 on 5.0

It's illegal.  You can claim gratuity.  You can file a complaint to competent offfiver under the gratuity Act and if not resolved you can file a case in labour court. You can also file a complaint to labour commissioner

Prashant Nayak
Advocate, Mumbai
31911 Answers
179 Consultations

4.1 on 5.0

issue legal notice to company to pay your gratuity amount

2) if company inspite of notice refuses to pay you can file claim before the Controlling Authority under the Payment of Gratuity Act within the area, your employer's establishment is situated or where you were working at the time of termination.

Ajay Sethi
Advocate, Mumbai
94657 Answers
7524 Consultations

5.0 on 5.0

There is a formula using which the amount of gratuity payable is calculated. The formula is based on the 15 days of last drawn salary for each completed year of service or part of thereof in excess of six months.

The formula is as follows:
(15 X last drawn salary X tenure of working) divided by 26

Here last drawn salary means basic salary, dearness allowance, and commission received on sales.

Ajay Sethi
Advocate, Mumbai
94657 Answers
7524 Consultations

5.0 on 5.0

Dear Concern, your total grauity amount is Rs. 92,308/-. The calculation is below : basic wages X 15/26 X No. of years in service.  Salary means basic plus DA but in your case there is no DA.  Hence,  16000 X 15/26 X 10 = Rs. 92,308/-. Here total of years counted as 10 because you hv worked for 9.6 months and you are eligible for this figure. If your previous company is not paying the same after expiry of 15 days from your request ,  you can file complaint under section 3 of the Payment of Gratuity Act, 1872 and controlling authority under section 8 after providing an opportunity to employee to pay, may direct to pay.  In case employer fails to pay, he may issue certificate for grauity amount and interest at central rate to the maximum of gratuity and pay you after recovering from employer as arrears of land revenue.  Authority is in this case is concerned labour office and the concerned person is Asstt Labour Commissioner where the office of company is situated or last office address where you worked. Hope your queries will be sorted out.  Feels free to contact further. 

Ram Kumar
Advocate, Delhi
16 Answers
1 Consultation

Not rated

File an application with the Controlling Authority/Dy. Labour Commissioner/ALC as the case may be for recovery of gratuity, paying bonus does not mean to deprive from the gratuity, you will get approx.Rs.95000/- as gratuity.

Koshal Kumar Vatsa
Advocate, Gurgaon
2283 Answers
3 Consultations

5.0 on 5.0

Your gratuity payable for your service if contested will be Rupees. 1,82,019. 

Prasaanth Bandaru
Advocate, Hyderabad
4 Answers
2 Consultations

4.9 on 5.0

You can claim gratuity if ther is a provision or if the company is coming under the gratuity scheme.

In India gratuity is a type of retirement benefit. It is a payment made with the intention of helping an employee monetarily after his retirement.

it applies to those organisations with 10 or more persons are employed on any day of the preceding 12 months. Under Section 1(3-A), if in case of any shop and establishment to which the act applies the number of employee reduces below 10, it shall continue to be governed by the act irrespective of the number of employee's. Thus no employer can escape liability under this act by reducing the number of employee's. Under Section 2(e), Nothing in this act applies to Apprentices and Persons who hold civil posts under the Central Government or State Government and are subjected to any other act or rule other than this act.

You can issue a legal notice to the company demanding gratuity payment  after which you can initiate legal action as per law for recovering gratuity amount 

T Kalaiselvan
Advocate, Vellore
84852 Answers
2188 Consultations

5.0 on 5.0

The gratuity amount depends upon the tenure of service and last drawn salary. It is calculated according to this formula: Last drawn salary (basic salary plus dearness allowance) X number of completed years of service X 15/26.

According to this formula, the time period of over six months or more is considered as one year.

This means if you have completed five years and seven months of service, the number of years would be considered as six years for calculation of gratuity benefit.

On the other hand, if the service period is five years and five months, for gratuity calculation it will be considered five years.

 

T Kalaiselvan
Advocate, Vellore
84852 Answers
2188 Consultations

5.0 on 5.0

  • Maximum amount specified by the government which is currently Rs. 10 lakh
  • Last drawn salary X 15/26 X years of service
  • Actual gratuity received

For example, the last drawn salary (basic plus DA) of Mr Ashish, for example, is Rs. 60,000 (per month) and he has worked for 25 years. The gratuity according to the formula is Rs. 8.65 lakh but suppose he has actually received gratuity of Rs. 12 lakh.

Section 3 of the Payment of Gratuity Act, 1972 provides for a ‘Controlling Authority’.

  • The Controlling Authority may issue a notice in Form ‘O’ to both the applicant employee and the employer. The two parties will then have to appear before the authority on a specified date, time, and place, given in the notice.
  • If the employer fails to present himself or an authorized person before the authority, the authority may proceed to hear the case and determine the employee’s application ex parte.
  • If the employee fails to appear before the authority on the specified date, then the application will be disposed of.

  • If you have been denied gratuity payment by your employer, you can file a complaint under Section 8 of the act, against the company. The controlling authority, on hearing both sides, if satisfied with the employee’s stance, can direct the employer to pay the gratuity that is due along with the interest on it.
  • If an employer fails to pay gratuity amount along with interest 30 days after the controlling authority has directed it to do so, the appropriate government, be it Central Government or State Government, whoever is concerned with the employing organization, will authorize the controlling authority to start prosecution against the employer, within 15 days.

T Kalaiselvan
Advocate, Vellore
84852 Answers
2188 Consultations

5.0 on 5.0

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