News India Live, Digital Desk: Gratuity rules update: Many employees have the question in the mind that it is necessary to complete 5 years before leaving the job, only then you will get gratuity? Now according to the new rules, this is not the case at all. After a clear change in gratuity rules related to gratuity, you can now be entitled to gratuity even in less than 5 years.
What do the new rules of gratuity say?
Under the Gratuity Payment Act 1972, now employees can claim gratuity even before completing 5 years. According to this, if you have completed 4 years and 240 days of service in a company, then you have the right to get gratuity. Before leaving the job, do the correct calculation of your service period.
When does the 240 -day rule apply?
- The 240 -day rule applies to employees who generally work 6 days a week.
- If you are working in mines or a company where less than 6 days a week, then the 190 -day rule applies there.
- If the employee has completed 240 days in the 5th year, it will be considered equal to completing 5 years of service.
What do the decisions of the courts say?
Delhi and Madras High Courts have made it clear that employees who have completed 4 years and 240 days are eligible to get gratuity. At the same time, the Karnataka High Court has clarified that if the employee voluntarily resigns, he will have to complete the entire 5 -year service for gratuity, although this rule will also apply for 4 years and 240 days in conditions like illness or accident.
How to calculate gratuity?
Gratuity formula is extremely simple:
(15 X अंतिम सैलरी X सेवा अवधि) / 26
For example, if an employee has a final salary of Rs 40,000 and has worked 4 years and 300 days, which will be considered a 5 -year service period.
(15 X 40,000 X 5) / 26 = 1,15,385 रुपये
When does gratuity be taxed?
According to government rules, gratuity up to Rs 20 lakh is completely tax-free. If you get more than 20 lakh rupees gratuity, then you have to pay tax on additional amount.
If your company refuses to give gratuity, you can complain to the labor department or court. Be aware of your services and rights.
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