- The 5-year threshold for becoming eligible for gratuity may be relaxed
- Labour market experts also said that the current five-year rule, which was formulated long time back, needs to be revised
The 5-year threshold for becoming eligible for gratuity may be relaxed. As the job tenures are increasingly becoming shorter and also with declining job security and increasing contractualization of employment, the government is considering lowering the threshold limit for gratuity, Mint reported citing government officials. Labour market experts also said that the current five-year rule, which was formulated long time back, needs to be revised. Gratuity payment is governed by The Payment of Gratuity Act 1972.
Current gratuity rules at a glance:
An employee is eligible to receive gratuity only if she has completed minimum five years with the same organisation.
The employment of five years in an organisation should be continuous, without any gap.
An employee who becomes disable due to sickness or an accident, whether or not she has completed her five years service with that employer is also eligible to receive the gratuity.
Source: livemint
