Criminal Lawyer

Payment of Gratuity Act,1972, Labour Law Consultant ESI PF Consultant in Delhi, 9711905747

Payment of Gratuity Act,1972

Labour Law Consultant, Employee's Provident Fund (EPF), Employee's State Insurance Corp. (ESIC) Maintenance of Records for various Labour Laws i.e. Employees Provident Fund & Miscellaneous Provisions Act, Employees State Insurance Act., Factories Act, 1948, Payment of Wages Under Minimum Wages Act, Bonus Act and Complete services for PayrollTDS and Professional Tax etc.

Payment of gratuity act,1972

Applicability of the Act
  • the act applicable to the whole of India. Provided that in so far as it relates to plantations or ports,
  • Every factory, mine, oilfield, plantation, port and railway company
  • shops and other establishments, Employing 10 or more workmen. The Act provides for payment of gratuity at the rate of 15 days wages for each completed year of service subject to a maximum of Rs. twenty lakh. In the case of seasonal establishment, gratuity is payable at the rate of seven days wages for each season. 
  • The Act does not affect the right of an employee to receive better terms of gratuity under any award or agreement or contract with the employer.
  • Central Government is the Appropriate Government in relation to an establishment belonging to or under the control of the Central Government or having branches in more than state or an establishment of a factory belonging to or under the control of Central Government or of a major port, oilfield railway or mine.

Gratuity Rules (Compliances)

Gratuity Nomination form

Gratuity Claim form

Gratuity pay form 

Gratuity Calculation

Gratuity formula

Gratuity LIC Scheme Plan
Gratuity Registration procedure in LIC Scheme plan
Gratuity Notification/Circular
Gratuity Limit
Form A Notice of Opening
Form B Notice of Changes

Payment of Gratuity: [Section 4(1)]

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 condition of the completion of five years continuous service is not essential in case of the termination of the employment of any employee due to death or disablement. Generally, it is payable to the employee himself.   However, in case of death of the employee it shall be paid   to his nominee or if no nomination has been made, to his heirs.

Calculation of Gratuity Amount Payable: [Section 4(2)]

  1. In the establishments other than seasonal establishments- the employer shall pay the gratuity to an employee at the rate of 15 days wages based on the rate of wages last drawn by the employee concerned for every completed year of service or part thereof in excess of 6 months.
  2. In case of an employee who is employed in a seasonal establishment can be  classified into two group
  • those who work throughout the year &
  • who work only during the season.
The former who are the monthly rated employee are entitled to get the gratuity at  the rate of   15 days wages for every completed year of service or part thereof in  excess of  six months. The later are, however, entitled to received gratuity at the rate of seven days’ wages for each season.

In case of a monthly rated employee; the fifteen days’ wages shall be  calculated by  dividing the monthly rate of wages last drawn by him by twenty-six and multiplying the quotient by  fifteen.

Forfeiture of Gratuity: [Section 4(6)]

1.        Forfeiture to the extent of the damage/ loss: If the services of an employee have been terminated for-
(i)        any act,
(ii)      willful omission, or
(iii)     negligence
causing any damage or loss to, or  destruction of, property belonging to  the employer- there the gratuity shall be forfeited to the extent of the damage or loss so caused;
2.        Wholly or partially forfeiture of gratuity: (i) where if the services of  such employee have been terminated for his riotous or disorderly conduct or any other act of violence on his part, or (ii) if the services of such employee have been terminated for any  act  which  constitutes an offence involving moral turpitude.

Mode of Payment of Gratuity:

The gratuity shall be paid either-(i) in cash, or (ii) in demand draft, or (iii) bank cheque to the claimant. If the claimant so desires and the amount of gratuity payable is less than one thousand rupees, payment may be made by postal money order after deducting the  commission due to such postal money order from the amount payable. The intimation about   the details of payment shall be given to the controlling authority by the employer.

Where nominee or a legal heir is a minor- there the controlling authority shall invest the gratuity amount deposited with him for the benefit of such minor in term deposit with the State

Appointment of Inspectors

Inspector is person who is appointed by appropriate govt. for inspecting or checking the Documents of the Organisation, whether the organisation is covered by the Payment of Gratuity Act,

Powers of inspectors: An inspector may exercise all or any of the following powers, for the purpose of ascertaining the compliance of the various provisions of the Act, namely,
  • To require an employer to furnish such information as he may consider necessary,
  • To examining any register, record or notice or other documents required to be kept or exhibited under this Act or the rules made thereunder.
  • To examine the employer or place and who, he has reasonable cause to believe is an employee employed therein.


If the amount of gratuity is not payable by employer within the prescribed time to employee, the controlling authority shall issue a certificate for that amount to the Collector to recover the same alongwith the compound interest at such rate as prescribed by the Central Government


If Gratuity is not paid by the employer under the act, the employer shall be punishable with imprisonment for a term which shall not be less than six months but which may extend to two years unless the court trying the offence, for the reasons to be recorded by it in writing,

For More Details

Service Area

RDJ Consultants is one of the leading Gratuity Consultant in Delhi & NCR, Gurgaon, Noida, Faridabad and Bahadurgah there are many reputed clients in various places like Okhla, Lajpat Nagar, Mohan Co-Operative Mathura Road, Jung Pura, Nehru Place, Saket, Wazirpur, Mayapuri, Naraina, Rohini, Pitampura, Rajouri Garden, Chhatarpur, Azadpur, Karol Bagh, Rajendra Place, Karampura, Kirti Nagar, Najafgarh, Dwarka, Kapashera, Laxmi Nagar, Shahdra, Uttam Nagar, Janak Puri, Vikas Puri, Palam, Mehrauli, Sangam Vihar, Saini farm, Badarpur Border, jaitpur, Sriniwaspuri, Nandnagari, Tis Hazari, Bawana, Nangloi, Mahipalpur, R K Puram, Vasant Kunj, Sarita Vihar, Lado Sarai, District Centre, Tilak Nagar, Ghitorni, Ashok Vihar, Mayur Vihar, Kalkaji, Safdarjung, Green Park.

Get More of our Update