An employee becomes entitled to receive gratuity after completing five years of service in any company. This rule is according to the ‘Gratuity Payment Rules 1972’. However, many employees are not aware that if they leave their job before completing 5 years of service with the company, they also become entitled to gratuity. In this, it becomes necessary for the employees to complete a certain time. If you have an offer from another company and you are not able to go only because of gratuity, then know how you become eligible for gratuity in 4 years?
Gratuity will be received in 4 years 240 days
Let us tell you that employees do not need to serve for 5 years in a company to get gratuity. Actually, an employee becomes eligible to get gratuity when he has worked for more than 4 years and 240 days in a company. Suppose, an employee joins a company on January 1, 2021, if he leaves the job after August 29, 2025, then he becomes entitled to get gratuity. This is because by that date the employee would have completed 4 years and 240 days in service. For this, the employee will not have to wait till January 1, 2026 to complete 5 years.
After how many days of work one does not get gratuity?
According to media reports, 240 days are equal to 7.89 months. Every employee must note that their working period should be 4 years and 8 months. Only after this they will be eligible for gratuity. Employees who serve for less than 4 years and 240 days will not get gratuity. However, 5 years of service is not necessary even in case of death or disability of an employee.
What is gratuity?
According to the Payment of Gratuity Act, gratuity is the amount that the company pays to any employee for his work. This amount is made by combining the employee’s salary, dearness allowance and commission. To avail this benefit, employees have to work in the same company for at least 5 years or 4 years 240 days.
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