Gratuity hold on basis of clause in employment contract

Labour & Industrial 1879 views 2 replies

janu

24 Points Joined May 2012

My mother has worked for an institute for last 20 years, it’s a school ruled by a private trust, she had to take a year leave as her health did not do fine, further on after a year still her health did not do fine therefore she had to give her resignation, she was asked by the school to submit the resignation in a particular format given to her by the H.R authorities. After everything was done, she inquired about the gratuity which she deserved, to which she was given a skipping answer saying that the principal will decide about the same after two or three months…

Further on she was even reminded that the school had taken her signature over paper in which she had waived off such rights when she was made a permanent teacher in the school..

Any advice about the same, does her signing over some paper really waive her rights of receiving gratuity?

Does school like these under trust come under the Gratuity act?

What next should be our action?

Replies (2)

SRINIVASARAO

DY MANAGER

31 Points Joined June 2011

Dear Sir,

Please find the reply to your question:

The provisions of the Act clearly show that Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years on His superannuation, or on his retirement, or resignation or on his death or disablement due to accident or disease.

The only provision under which gratuity can be withheld is found in section 4(6) of the act. In terms of the above section Gratuity can be forfeited only if the services of an employee has been terminated for any act of commission or negligence causing any damage or loss to, destruction of, property belonging to the employer and such forfeiture shall be to the extent of loss or damage so caused.

Section 13 of the act provides that gratuity payable to an employee shall not be liable to attachment in execution of any decree or order of any civilian, revenue or criminal Court. The said section in effect protects the gratuity payable to an employee.

The Calcutta High Court judgement reported in 2001 (2) LLN 749 held that an employee cannot waive his Rights under the payment of gratuity act 1972 because the provisions of payment of gratuity have been enacted for reasons of public policy.It also held that gratuity due to an employee cannot be withheld merely because the claim for damages for unauthorised occupation is pending. The employees cannot waive the rights available to them because it is the right created under the statute. Hence, any deduction of gratuity based on undertaking given by the employee will be construed as withholding of gratuity and hence will not be permissible.

Trusts this will help you

regards

ts rao

@VaibhavJ

Believe!! Live your dreams!

33521 Points Joined November 2008

Hey

In continuation to above..

Gratuity cannot be stopped,deducted,adjusted or postponed for any reason. A case could be filed with the competent auothority for the recovery of the gratuity amount entited.

If the amount of gratuity is not paid by the employer within the prescribed time to the person entitled thereto, the aggrieved person should make an application to the Controlling Authority under the Payment of Gratuity Act within the area where the employer's establishment is situated or where the employee was working. The controlling authority shall issue a certificate for that amount to the Collector, who shall recover the same, together with compound interest thereon at such rate as the Central Government may, by notification, specify, from the date of expiry of the prescribed time, as arrears of land revenue and pay the same to the person entitled thereto.

Process is as follow:

File form - I to employer after 30 days of leaving Job. Form I is application for gratuity by an employee to employer. It is to be filed in duplicate & acknowledgement to be obtained from employer.

An employer is to required to answer to this application in writing for non -payment. If it is answered then make an application to the Controlling Authority under the Payment of Gratuity Act within the area where the employer's establishment is situated or where the employee was working.

If the establishment is semi government orgainsation, you can file writ claiming all terminal dues. writ remedy is also available.

An employer is required to pay the gratuity to the separated employee within 30 days of an employee leaving the organization. In case if the employer fails to do so, then he should pay the gratuity amount to the ex-employee alongwith interest @ 12% from the 31st day of employee's leaving.

Pleae revert for any query.

Thanks!!