Dear All,
I want to understand if gratuity can be deducted, as i have seen so many MNC companies deducting gratuity on a monthly basis which I really think is not a legal practice or at par with Payment of Gratuity Act, 1972 as it a kind of benefit which the company provides to their employees after 5 years of their contributory services to that organisation or post retiement, permanent disablement due to an accident & therefore I believe there is no point in deducting it from employee's salary monthly.
Please give your inputs, awaiting for the guidance.
Regds,
Smruti
From India, Mumbai
I want to understand if gratuity can be deducted, as i have seen so many MNC companies deducting gratuity on a monthly basis which I really think is not a legal practice or at par with Payment of Gratuity Act, 1972 as it a kind of benefit which the company provides to their employees after 5 years of their contributory services to that organisation or post retiement, permanent disablement due to an accident & therefore I believe there is no point in deducting it from employee's salary monthly.
Please give your inputs, awaiting for the guidance.
Regds,
Smruti
From India, Mumbai
Dear Smruti,
You are correct. Under the Payment of Gratuity Act, it is an additional benefit/statutory claim for employees. The quantum of Gratuity can be computed only on completion/ stoppage of service.
Abbas.P.S
From India, Bangalore
517You are correct. Under the Payment of Gratuity Act, it is an additional benefit/statutory claim for employees. The quantum of Gratuity can be computed only on completion/ stoppage of service.
Abbas.P.S
From India, Bangalore
Yes, I agree with the views expressed.
Gratuity is a contingent payment, payable on separation.
The practice adopted by MNCs - to show it on CTC at the time of joining or to deduct an amount every month; is absolutely incorrect.
It shows that MNC's do not understand or comply with the Indian standards/practice; or they have hired HR's who are either incompetent or lack the conviction and courage to explain the ground realities to their masters.
Warm regards.
From India, Delhi
Gratuity is a contingent payment, payable on separation.
The practice adopted by MNCs - to show it on CTC at the time of joining or to deduct an amount every month; is absolutely incorrect.
It shows that MNC's do not understand or comply with the Indian standards/practice; or they have hired HR's who are either incompetent or lack the conviction and courage to explain the ground realities to their masters.
Warm regards.
From India, Delhi
Find answers from people who have previously dealt with business and work issues similar to yours - Please Register and Log In to CiteHR and post your query.
Advance can be deducted from gratuity if agreed by employee - Kolkatta HC 29.11.2012.pdf
Gratuity Form I.doc