Gratuity after inter branch transfer

Hi Soran,

This is a practical and important question about gratuity eligibility after an inter-company (inter-branch) transfer within the same group.

Key Points:

1. Gratuity Eligibility Basics:

   • As per the Payment of Gratuity Act, 1972, an employee is eligible for gratuity if they have completed 5 years or more of continuous service with the same employer.

   • "Continuous service" means uninterrupted service with the same employer.

2. Inter-Branch / Inter-Company Transfer:

   • In your case, you are moving from the school (one legal entity) to a Pvt Ltd company (another legal entity) even though both are under the same management group.

   • Legally, these are two different employers.

   • Service with one employer generally does not get counted towards gratuity with the other employer unless there is a formal arrangement.

3. Will Your Past Service Count?

   • It depends on whether the two entities have a formal transfer agreement that recognizes past service as continuous.

   • Some groups have “transfer of service” letters or internal policies confirming continuity.

   • If no such formal agreement, the Pvt Ltd company may treat your service as fresh from date of joining.

4. What You Should Get:

   • A written confirmation/email from management clearly stating that your service period (since Jan 2018) will be counted towards gratuity.

   • Preferably, a transfer letter or appointment letter from Pvt Ltd that mentions continuity of service.

   • Any communication clarifying that your gratuity will be payable either by the school or Pvt Ltd company on separation.

5. Practical Suggestion:

   • Keep all emails and letters safe as proof.

   • You may also ask for a copy of the group’s gratuity policy if available.

   • Clarify who will be responsible for gratuity payment.

Summary: