Dear,
Gratuity is payable to a person if he works for a minimum period of 5 years in a same company whether it is a parent company or sister company but the management must be the same. and records must be maintained by the HO.
Regards,
hari
From India, Mumbai
1Gratuity is payable to a person if he works for a minimum period of 5 years in a same company whether it is a parent company or sister company but the management must be the same. and records must be maintained by the HO.
Regards,
hari
From India, Mumbai
I have one more query. When do you call the managements of two companies are same? How do you prove that the managements are same? The structure of the group companies are created in such a manner that it becomes difficult to prove the same management.
From India, Mumbai
From India, Mumbai
Also my employer deducts the gratuity amount from my CTC. Can I claim this amount even if I were to leave the company before 5 years, as in this case the money is coming from my CTC and is not being contributed by the employer.
From India, Mumbai
From India, Mumbai
Dear Sai,
As regards to your CTC query, please understand that the CTC is Cost to the Company for employing you in his organisation. It is nothing but a budget forecast. Your CTC to be read like this: -
- Basic components like Basic, HRA, Conveyance, Children Education Allowance and any flexi balance.
- Re-imbursements like, Medical Re-imbursement Allowance, LTC and for entertainment allowance like
Books & periodical.
- Benefits like PF, Gratuity, GPA, Mediclaim policy, Bonus or Ex-gratia.
Out of the above, the Basic components and the Re-imbursement forms the Gross salary, which is your actual salary from which your part of PF is deducted and the net pay is given.
The other part, i.e., "Benefits" is given by the employer to you in the form of Retiral benefits like PF (employer's share), gratuity, Bonus or Ex-gratia and the medical benefits like GPA and Mediclaim etc, which is a statutory expenditure to the employer for employing you in the concerned organisation. These expenses have to be accounted some-where, and the word CTC has born. Please remember, Gratuity is not deducted from your basic components and re-imbursement allowances.
It is the employee, who misunderstands the concept of CTC and not the employer. In future, when you are told of CTC by the HR staff, kindly check the gross and net pay and do not get excited with the CTC amount. Many companies have different benefits structure and accordingly the CTC will vary.
Hope your doubts are cleared on CTC.
Regards,
P. Vathiraj
From India
As regards to your CTC query, please understand that the CTC is Cost to the Company for employing you in his organisation. It is nothing but a budget forecast. Your CTC to be read like this: -
- Basic components like Basic, HRA, Conveyance, Children Education Allowance and any flexi balance.
- Re-imbursements like, Medical Re-imbursement Allowance, LTC and for entertainment allowance like
Books & periodical.
- Benefits like PF, Gratuity, GPA, Mediclaim policy, Bonus or Ex-gratia.
Out of the above, the Basic components and the Re-imbursement forms the Gross salary, which is your actual salary from which your part of PF is deducted and the net pay is given.
The other part, i.e., "Benefits" is given by the employer to you in the form of Retiral benefits like PF (employer's share), gratuity, Bonus or Ex-gratia and the medical benefits like GPA and Mediclaim etc, which is a statutory expenditure to the employer for employing you in the concerned organisation. These expenses have to be accounted some-where, and the word CTC has born. Please remember, Gratuity is not deducted from your basic components and re-imbursement allowances.
It is the employee, who misunderstands the concept of CTC and not the employer. In future, when you are told of CTC by the HR staff, kindly check the gross and net pay and do not get excited with the CTC amount. Many companies have different benefits structure and accordingly the CTC will vary.
Hope your doubts are cleared on CTC.
Regards,
P. Vathiraj
From India
Dear Sai ji,
I suggest, you should first write a letter to your company stating that you worked with company A from this date to this date and with company B from this date to this date. Your services were transferred from company A to company B not at the instant of you but at the instant of management of company A and company B. The management of company A and company B is one and the same. There is no break also in your service with company A and company B. And thus you have continuous service of more than 5 years. Under the circumstances, you are liable for Gratuity under the Act. Request the company to settle your claim of Gratuity at the earliest. Take acknowedgement of the letter. If company deny your claim, write to the authority under the Act. You should get your Gratuity. It is your right if the above things are established.
All the best.
From India, Mumbai
I suggest, you should first write a letter to your company stating that you worked with company A from this date to this date and with company B from this date to this date. Your services were transferred from company A to company B not at the instant of you but at the instant of management of company A and company B. The management of company A and company B is one and the same. There is no break also in your service with company A and company B. And thus you have continuous service of more than 5 years. Under the circumstances, you are liable for Gratuity under the Act. Request the company to settle your claim of Gratuity at the earliest. Take acknowedgement of the letter. If company deny your claim, write to the authority under the Act. You should get your Gratuity. It is your right if the above things are established.
All the best.
From India, Mumbai
Dear Sai2967
In a case of transfer with in a group company the services rendered by the concerned employee with the previous company and present to be added and if the aggregate of both is above 5 years the employee concerned is entitled for Gratuity Payment.
Most important thing is to be noted that the Date of Appointment does not change in a case of transfer and since in a case of transfer the later employer accepted the transfer voluntary they are liable to pay it.
PKJAIN
From India, Delhi
In a case of transfer with in a group company the services rendered by the concerned employee with the previous company and present to be added and if the aggregate of both is above 5 years the employee concerned is entitled for Gratuity Payment.
Most important thing is to be noted that the Date of Appointment does not change in a case of transfer and since in a case of transfer the later employer accepted the transfer voluntary they are liable to pay it.
PKJAIN
From India, Delhi
Dear Vathiraj ji,
i have one doubt about PF. if any employee X getting 50000/- salary for the company. Mr.X told to HR department not deduct EPF contribution to his salary.but his salary mentioned monthly salary statement.what are the legal problem occurred to EPF department.
in case as per minimum wage base and as per EPF roles base we are deducting EPF amount to his salary. the employee action to be taken against to the management co and below employees gather stop the work.(note:X means 10employees)
what action to be taken against the both case. suggest me.
M.Chaitanya Krishna
From India, Nellore
i have one doubt about PF. if any employee X getting 50000/- salary for the company. Mr.X told to HR department not deduct EPF contribution to his salary.but his salary mentioned monthly salary statement.what are the legal problem occurred to EPF department.
in case as per minimum wage base and as per EPF roles base we are deducting EPF amount to his salary. the employee action to be taken against to the management co and below employees gather stop the work.(note:X means 10employees)
what action to be taken against the both case. suggest me.
M.Chaitanya Krishna
From India, Nellore
Dear Mr. Chaitanya,
Actually, I am not clear on your query. Any how, as regards to deduction of PF for the employees who are drawing more than Rs. 6500/- (Basic, DA, Retaining allowances (if any) and cash value of food concession admissible thereon) per month, I would like to draw your attention on para 2 (f) of EPF Scheme, 1952, which talks about "excluded employee" as under: -
Para 2 (f) "Excluded employee" means-
(i) An employee who, having been a member of the fund, withdrew the full amount of his accumulations in the Fund under clause (a) or (c) of sub-paragraph (1) of paragraph 69;
(ii) An employee whose pay at the time he is otherwise entitled to become a member of the Fund, exceeds Six Thousand and Five Hundred Rupees per month;
Now, sub para (1) of Paragraph 69 of EPF Scheme 1952 talks about the circumstances in which the accumulations in the Fund are payable to a member, wherein lot of clauses specifies the circumstances under which one can withdraw the PF amount.
But, for getting the exclusion from paying the contribution, only clause (a) and (c) of sub-para (1) of para 69 above, are to be taken into consideration. It speaks like this: -
clause (a) - On retirement from service after attaining the age of 55 years;
Clause (c) - Immediately before migration from India for permanent settlement abroad or for taking the employment abroad;
So, literally one can be excluded from paying the PF contribution, despite the fact that he is drawing his wages more than Rs. 6500/- per month, is only on retirement, or on posting to abroad.
Alternately, a fresher, who is drawing a salary of Rs. 6500/- per month at the start of his career may prefer this tag of "excluded employee".
Though the act permits a person to withdraw the PF contribution, which is standing on his credit, on resignation, on invalidment, on termination or on retrenchment, it does not allow these clauses to be eligible for getting the tag of "excluded employee" from his new employment.
Since you have to fill Form 11 for getting the exclusion from paying the contribution, where the column on previous employment and the status of contribution amount has to be filled, the PF authorities will reject your case straight away, if your request is not as per the above clauses for excluded employee. (If you can convince the PF authorities of the region, then it is ok)
Hope this will clear your doubt on PF contribution. If you still have doubt, kindly contact me on my mobile no. 9585333344. I am located at Chennai.
Regards,
P. Vathiraj
From India
Actually, I am not clear on your query. Any how, as regards to deduction of PF for the employees who are drawing more than Rs. 6500/- (Basic, DA, Retaining allowances (if any) and cash value of food concession admissible thereon) per month, I would like to draw your attention on para 2 (f) of EPF Scheme, 1952, which talks about "excluded employee" as under: -
Para 2 (f) "Excluded employee" means-
(i) An employee who, having been a member of the fund, withdrew the full amount of his accumulations in the Fund under clause (a) or (c) of sub-paragraph (1) of paragraph 69;
(ii) An employee whose pay at the time he is otherwise entitled to become a member of the Fund, exceeds Six Thousand and Five Hundred Rupees per month;
Now, sub para (1) of Paragraph 69 of EPF Scheme 1952 talks about the circumstances in which the accumulations in the Fund are payable to a member, wherein lot of clauses specifies the circumstances under which one can withdraw the PF amount.
But, for getting the exclusion from paying the contribution, only clause (a) and (c) of sub-para (1) of para 69 above, are to be taken into consideration. It speaks like this: -
clause (a) - On retirement from service after attaining the age of 55 years;
Clause (c) - Immediately before migration from India for permanent settlement abroad or for taking the employment abroad;
So, literally one can be excluded from paying the PF contribution, despite the fact that he is drawing his wages more than Rs. 6500/- per month, is only on retirement, or on posting to abroad.
Alternately, a fresher, who is drawing a salary of Rs. 6500/- per month at the start of his career may prefer this tag of "excluded employee".
Though the act permits a person to withdraw the PF contribution, which is standing on his credit, on resignation, on invalidment, on termination or on retrenchment, it does not allow these clauses to be eligible for getting the tag of "excluded employee" from his new employment.
Since you have to fill Form 11 for getting the exclusion from paying the contribution, where the column on previous employment and the status of contribution amount has to be filled, the PF authorities will reject your case straight away, if your request is not as per the above clauses for excluded employee. (If you can convince the PF authorities of the region, then it is ok)
Hope this will clear your doubt on PF contribution. If you still have doubt, kindly contact me on my mobile no. 9585333344. I am located at Chennai.
Regards,
P. Vathiraj
From India
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