- As per Section 1(2) of the the Payment of Gratuity Act, this Act applies to all factories, mines, oilfields, plantations, ports and railway companies , but in the case of shops or establishments, other than those stated before, it applies to those organisations with 10 or more persons are employed on any day of the preceding 12 months.
- Further, an employee is eligible to receive gratuity, only if he has completed minimum five years of service with an establishment.
- Further , as per Madras High Court, the gratuity of an employee who completes 4 years and 240 days of service is eligible for gratuity.
- Further, as per Section 2A(1) , an employee shall be 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 sickness, accident, leave, absence from duty without leave.
- And further, Section 4(2) of the Payment of Gratuity Act provides that for every completed year of service in excess of six months, the employer shall pay gratuity to an employee for the whole year. That means if an employee works in the establishment for more than 6 months in a year, he shall be eligible to get gratuity , if the employee has had continuous service of 190 / 240 days.
- Since, your company is not completing the octet of 10 employees , hence you are not covered under the Gratuity Act.
- Assistant Labour Commissioners officer