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Querist : Anonymous (Querist)

21 September 2010 Is it necessary for an employee to complete 5 years in an organisation to be eligible for payment of gratuity or even if he covers 4 years and 240 days t is sufficient.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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21 September 2010 Rounding off of fraction of an year to a completed year is only for the purpose of calculating eligibilty. But for payment of gratuity 5 years tenure has to be counted with out the rouding off method. Courts have repeatedly said that in the case of fraction of an year to be converted to a completed year, the employee must have worked not less than 240 days in that fraction year. In other words an employee who is in continues service of not less than 4 years 8 months and 5 days will only get the benefit of the Payment of Gratuity Act,1972.

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