Dear seniors,
Kind Attention..! Please go through the below points.
1. We have submitted the list of employees for the year 2013 to LIC of India for renewal our Gratuity Policy
2. Later We have a received a letter from LIC stating that an Adhoc amount of Rs.xxxxx has to be paid for renewal of Policy.
3. Since last 5years company is issuing cheque for the Adhoc amount and renewing the policy for that year.
4. Every year after submitting the Cheque for Adhoc Amount, LIC has sent the actual quotation for that respective year.
5. Since last five years the actual quotation amount was not been paid by the company.
6. Now the quotation amount was reached to Rs.18 lakhs.
7. Management is not ready to Pay Rs.18 lakhs, Since last 5 years company is paying only adhoc amount.
8. Now gratuity settlement claims are getting rejected due to shortage of Fund.
Kindly help me how to convince the management for payment of actual quotation amount.
Your response is highly appreciated. Thanks in advance.
Regards,
K.SAIKISHORE
SENIOR EXECUTIVE - HR
09949423193
From India
51Kind Attention..! Please go through the below points.
1. We have submitted the list of employees for the year 2013 to LIC of India for renewal our Gratuity Policy
2. Later We have a received a letter from LIC stating that an Adhoc amount of Rs.xxxxx has to be paid for renewal of Policy.
3. Since last 5years company is issuing cheque for the Adhoc amount and renewing the policy for that year.
4. Every year after submitting the Cheque for Adhoc Amount, LIC has sent the actual quotation for that respective year.
5. Since last five years the actual quotation amount was not been paid by the company.
6. Now the quotation amount was reached to Rs.18 lakhs.
7. Management is not ready to Pay Rs.18 lakhs, Since last 5 years company is paying only adhoc amount.
8. Now gratuity settlement claims are getting rejected due to shortage of Fund.
Kindly help me how to convince the management for payment of actual quotation amount.
Your response is highly appreciated. Thanks in advance.
Regards,
K.SAIKISHORE
SENIOR EXECUTIVE - HR
09949423193
From India
Dear Kishore,
You have to obtain the contribution list, employee wise for the last 5 years, duly reconciling with your declaration/list of employees to be covered furnished to LIC for gratuity purposes, Arrive at year wise sum of employer's contribution due to LIC then adjust the ad-hoc amounts paid year wise and you will get the balance due to LIC or excess paid, if any. If you add up all the years of such amount of balance due/excess paid, if any you will get the net amount payable or adjustable. Care should be taken to eliminate names of employees left/deleted and settled in the list of employees each year duly adding new entrants year wise. Also ensure that list of employees and amount standing against each one of them every year takes care of provision of Gratuity Act. If this exercise is carried out you will know where you stand against the claim of Rs.18 lacs.
It's very dangerous that Gratuity claims are getting rejected due to this failure in reconciling year wise payments and dues. You'll land up paying over due interest till the claims are settled. Shortage of funds is no excuse.
This confusion could have been avoided had you reconciled every year and settling the contribution then there itself instead of allowing the differences to continue for 5 years now.
kumar.s.
From India, Bangalore
You have to obtain the contribution list, employee wise for the last 5 years, duly reconciling with your declaration/list of employees to be covered furnished to LIC for gratuity purposes, Arrive at year wise sum of employer's contribution due to LIC then adjust the ad-hoc amounts paid year wise and you will get the balance due to LIC or excess paid, if any. If you add up all the years of such amount of balance due/excess paid, if any you will get the net amount payable or adjustable. Care should be taken to eliminate names of employees left/deleted and settled in the list of employees each year duly adding new entrants year wise. Also ensure that list of employees and amount standing against each one of them every year takes care of provision of Gratuity Act. If this exercise is carried out you will know where you stand against the claim of Rs.18 lacs.
It's very dangerous that Gratuity claims are getting rejected due to this failure in reconciling year wise payments and dues. You'll land up paying over due interest till the claims are settled. Shortage of funds is no excuse.
This confusion could have been avoided had you reconciled every year and settling the contribution then there itself instead of allowing the differences to continue for 5 years now.
kumar.s.
From India, Bangalore
Dear Kumar,
I have joined the company in last year and reconciled all the five years, prepared year wise statement and presented to the management. But they are not satisfied. They are totally confused with Adhoc amount and quotation amount.
Since last five years they are following the same and instructed me not to implement new processes. I kept quite.
I would like to know what is the interest calculated on it if it is carry forwarded to next year.
Regards,
K.SAIKISHORE
From India
I have joined the company in last year and reconciled all the five years, prepared year wise statement and presented to the management. But they are not satisfied. They are totally confused with Adhoc amount and quotation amount.
Since last five years they are following the same and instructed me not to implement new processes. I kept quite.
I would like to know what is the interest calculated on it if it is carry forwarded to next year.
Regards,
K.SAIKISHORE
From India
You may have to point out to your management that they anyway have a legal liability to pay gratuity as per law. IT is upto the management to pay the dues out of their pocket or face the facts and clear dues with the insurance company.
If the management does not do this, it is antagonizing its former employees, insurance company besides acting against law and spoiling its image.
You may have to suitably make them understand these downsides.
From India, Bangalore
If the management does not do this, it is antagonizing its former employees, insurance company besides acting against law and spoiling its image.
You may have to suitably make them understand these downsides.
From India, Bangalore
------------------
Dear Kishore,
Accepting and not accepting the reconciled figure involves its own repercussions. If you don't pay LIC the amount what they want your gratuity claims will not get passed and you land up cutting a sorry figure in facing your employees and the Authorised Officer under the Gratuity Act apart from incurring interest to both LIC and left employees. There is no option for you as you said, you produced the reconciled figures and your management not prepared to accept reconciled figs. and wanted adhocism to continue which LIC won't accept. Ultimately all will land up facing litigations on each other. From your side just put up a detailed note giving all the relevant information and the fact that ultimate responsibility lies on your management. It is upto them to decide what they want to face.
kumar.s.
From India, Bangalore
Dear Kishore,
Accepting and not accepting the reconciled figure involves its own repercussions. If you don't pay LIC the amount what they want your gratuity claims will not get passed and you land up cutting a sorry figure in facing your employees and the Authorised Officer under the Gratuity Act apart from incurring interest to both LIC and left employees. There is no option for you as you said, you produced the reconciled figures and your management not prepared to accept reconciled figs. and wanted adhocism to continue which LIC won't accept. Ultimately all will land up facing litigations on each other. From your side just put up a detailed note giving all the relevant information and the fact that ultimate responsibility lies on your management. It is upto them to decide what they want to face.
kumar.s.
From India, Bangalore
If the working is wrong, or the lic has made a mistake, or if there is evidence that they have only asked to pay the adhoc amount, not the full amount, then you can take up the matter with the higher management from LIC. Ask one of your directors to go with you to convey the seriousness of the matter, LIC is very conscious of its image and of service levels.
From India, Mumbai
From India, Mumbai
I think you will get a clear picture if you can call the branch manager of the nearby LIC office and ask for the details.
From India, Mumbai
From India, Mumbai
Dear kishore,
First of all read the letter or notice of LIC calling for adhoc payment and the quotation received on payment of adhoc amount. Does it speak about payment of difference between adhoc & quoted amount after certain analysis. If not, is there deficiency of service by LIC. LIC cannot absolve themselves under the plea that the employer did not pay the quoted amt for many years. How can they renew the policy if employer does not comply with for previous years? Are they interested only in getting some money in the name of business but rejecting claims of the eligible employees. Tell LIC that once they collected some money for a year and continued to renew for later years without rectifying the shortcomings, they are liable to statutory payment to eligible employees and any damage or penalty arising out of non-payment shall be on their account. But first read & understand the clauses of the gratuity policy.
LIC cannot have the cake and eat it too. Let them understand their obligations once accepted some money in the name of gratuity policy.
Best wishes
From India, Mumbai
First of all read the letter or notice of LIC calling for adhoc payment and the quotation received on payment of adhoc amount. Does it speak about payment of difference between adhoc & quoted amount after certain analysis. If not, is there deficiency of service by LIC. LIC cannot absolve themselves under the plea that the employer did not pay the quoted amt for many years. How can they renew the policy if employer does not comply with for previous years? Are they interested only in getting some money in the name of business but rejecting claims of the eligible employees. Tell LIC that once they collected some money for a year and continued to renew for later years without rectifying the shortcomings, they are liable to statutory payment to eligible employees and any damage or penalty arising out of non-payment shall be on their account. But first read & understand the clauses of the gratuity policy.
LIC cannot have the cake and eat it too. Let them understand their obligations once accepted some money in the name of gratuity policy.
Best wishes
From India, Mumbai
Respected Seniors,
Could you please explain what is ad-hoc amount and quotation amount from LIC?
The same problem I am facing. My organization was paid premium amount for gratuity policy for the year 2012 but the list of employees was not given along with the details of their BASIC salary.
The policy is getting expired on 31st March 2013 and LIC want the details of employees for both years. In this connection, LIC has kept on hold the claims of employes.
What should I do further?
Regards,
Rahul
From India, Pune
Could you please explain what is ad-hoc amount and quotation amount from LIC?
The same problem I am facing. My organization was paid premium amount for gratuity policy for the year 2012 but the list of employees was not given along with the details of their BASIC salary.
The policy is getting expired on 31st March 2013 and LIC want the details of employees for both years. In this connection, LIC has kept on hold the claims of employes.
What should I do further?
Regards,
Rahul
From India, Pune
Dear Rahul,
Every year LIC will send a letter to company stating to renewal the policy for that year. Mean while they ask to deposit an adhoc amount before submitting the list of employees for that year.
After submitting the list of employees LIC will calculate the premium amount for the list submitted based on their Age & date of join and send the actual quotation amount for that year.
Company can directly pay the Actual quotation amount after submitting list the employees, Paying the Adhoc amount is not necessary if we renewal the policy on or before 31st March.
Regards,
K.SAIKISHORE
From India
Every year LIC will send a letter to company stating to renewal the policy for that year. Mean while they ask to deposit an adhoc amount before submitting the list of employees for that year.
After submitting the list of employees LIC will calculate the premium amount for the list submitted based on their Age & date of join and send the actual quotation amount for that year.
Company can directly pay the Actual quotation amount after submitting list the employees, Paying the Adhoc amount is not necessary if we renewal the policy on or before 31st March.
Regards,
K.SAIKISHORE
From India
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