Dear Member,
Could you please ensure that, Gratuity is applicable for Contract labor who have rendered 5 yrs continuous service in an organization?
Please share your comments with legal supports.
-Kannan R
From India, Bangalore
2Could you please ensure that, Gratuity is applicable for Contract labor who have rendered 5 yrs continuous service in an organization?
Please share your comments with legal supports.
-Kannan R
From India, Bangalore
There had been many posts in this forum regarding gratuity with citations and clarifications. I am not going to cite any sections now which you can find in this forum easily
Payment of gratuity act talks about employees. One who employs him.her is liable to pay gratuity. In your question, you had asked about Contract employee. The employer in this case is the Contractor who is engaged by a Principal Employer. Hence the Contractor is liable to pay gratuity to his employee.If the contractor does not pay then the employee can claim the same from the Principal Employer.
However another question will arise as to whether the employee has completed 5 years with the Principal employer which is unlikely except in some Public Sector where they have many contract employees working for years.Even if the employee has not completed five years with the Principal employer and if an amount is due from the contractor to the employee, then the Principal Employer is liable for the same with a right to recover the same from the Contractor.
details of relevant sections of Payment of Gratuity Act and Contract Labour( Regulation and abolition)Act is available in this forum itself under the head Gratuity
Thanks
From India, Chennai
Payment of gratuity act talks about employees. One who employs him.her is liable to pay gratuity. In your question, you had asked about Contract employee. The employer in this case is the Contractor who is engaged by a Principal Employer. Hence the Contractor is liable to pay gratuity to his employee.If the contractor does not pay then the employee can claim the same from the Principal Employer.
However another question will arise as to whether the employee has completed 5 years with the Principal employer which is unlikely except in some Public Sector where they have many contract employees working for years.Even if the employee has not completed five years with the Principal employer and if an amount is due from the contractor to the employee, then the Principal Employer is liable for the same with a right to recover the same from the Contractor.
details of relevant sections of Payment of Gratuity Act and Contract Labour( Regulation and abolition)Act is available in this forum itself under the head Gratuity
Thanks
From India, Chennai
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Gratuity to contract labour.docx