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Gratuity question

M.pratish (Interested to gather knowledge ) (46 Points)

29 June 2014

Dear experts,

I need clarification on which basic gratuity is calculated in corporate /BPO companies.

I joined a company on 3-8-2009, if he completes 3-8-2014. Then he had successfully completed 5 years of service in that organisation. Now my question is 5 years of service includes 120 days of Loss of pay(informed and uninformed days), kindly explain whether that employee is eligible for gratuity or not as per Gratuity Act 1972. Kindly send my legal documents or link.

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9 Replies

(Guest)

yes he is eligible.... you were the employee of that company for those 120 days also na....

for being eligible to be grautity u must have been employee of that co for five continous years

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M.pratish (Interested to gather knowledge ) (46 Points)
Replied 02 July 2014

Thanks you sir, do you have any legal document or link. So that I can share with my hr department. I feel enraptured if I get the like or notification at earliest.

M.pratish (Interested to gather knowledge ) (46 Points)
Replied 02 July 2014

Thanks you sir, do you have any legal document or link. So that I can share with my hr department. I feel enraptured if I get the like or notification at earliest.

(Guest)

As per Payment of Gratuity Act 1972, any employee who has been in continuous service for 5 years is eligible for gratuity .

During the above mentioned 5 years , employee is eligible for casual leave and sick leave without affecting his eligibility.

In case of death of an employee , the above condition 5 Years of continuous service is not applicable i.e. even if an employee dies

after 2 years of service , he/she is still eligible for gratuity .

https://ca-lectures.com/articles/gratuity-calculation-formula-in-india-2013/

(Guest)

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. An employee shall be said to be in continuous service for a period if he has, for that period, been in uninterrupted service and includes service which may be interrupted on account of sickness, accident, leave, absence from duty without leave, lay off, strike or a lock-out or cessation of work not due to any fault of the employee, whether such uninterrupted or interrupted service was rendered before or after the commencement of this Act.

Where an employee is not in continuous service for any period of one year or six months, he shall be deemed to be in continuous service under the employer:

if for the said period of one year he has worked for one hundred and ninety days in the case of an employee employed below the ground in a mine or in an establishment which works for less than six days in a week and two hundred and forty days in any other case;
if for the said period of six months has actually worked under the employer for not less than ninety-five days in the case of an employee employed below the ground in a mine or in an establishment which works for less than six days in a week and one hundred and twenty days, in any other case;
The number of days on which an employee has actually worked under an employer shall include the days on which:
1. he has been laid-off under an agreement or as permitted by standing orders made under the Industrial Employment (Standing Orders) Act, 1946 or under the Industrial Disputes Act, 1947 or under any other law applicab1c to the establishment;
2. he has been on leave with full wages earned in the previous year;
3. he has been absent due to temporary disablement caused by accident arising out of and in the course of his employment and
4. in the case of a female, she has been on maternity leave; so, however, that the total period of such maternity leave does not exceed twelve weeks.
In case of employees in seasonal establishments he shall be deemed to be in continuous service for any period of one year or six months if he has actually worked for not less than seventy-five per cent of the number of days on which the establishment was in operation during such period.

https://www.helplinelaw.com/employment-criminal-and-labour/ECGI/eligibilty-for-claiming-gratuity-in-india.H T M L

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M.pratish (Interested to gather knowledge ) (46 Points)
Replied 02 July 2014

Thanks you for sharing your inference.

M.pratish (Interested to gather knowledge ) (46 Points)
Replied 23 July 2014

Dear experts,

PFAC and please let me know the law / section or amendment that I can refer to for this

Regards

Pratish.M

Attached File : 194234 1342269 attendance.xls downloaded: 141 times

M.pratish (Interested to gather knowledge ) (46 Points)
Replied 11 March 2015

Can you solve below probles that belongs to finanical managements

Question:

A limited compnay has the following capital structure:

Equity share capital (200000 shares)4000000

6% preference shares1000000

8% debentures 3000000

Total 8000000

The market price of the compnay’s equity share is Rs-20/-. It is expected that compay will pay a current dividend of Rs-2 per share which will grow at 7%. The tax rate may be presumed at 50%. You are required to compute the following.

Weighted average cost of capital
The new weighted average cost of capital, if the company raises an additioanl Rs-2000000/- debt by issuing 10% dedentures. This would resilt in increasing the expected divided to Rs-3/- and the price of equity share wull fall to Rs-15 per share. The growth rate is 7%.

3. Question

Following are the details relating to three companies which are identical in terms or “r”.

ABC LTD: Cost of capital-10%, earing per share Rs-10, rate of return expected 5% and dividend payout ration 25%,50%,75% and 100%.

MNC LTD: Cost of capital-10%, earing per share Rs-10 and rate of return expected 5%.

XYZ LTD: Cost of capital-10%, earing per share Rs-10 and rate of return expected 5%.

Find out the price of equity shares using walter’s and gordon’s model. What is the optimum payout?

thanks in advance...