Eligibility for gratuity at 4 years and 6 Months

As per Section 4(1) of the Payment of Gratuity Act 1972, an employee becomes eligible for gratuity only after completion of 5 years of continuous service with the same establishment. There is an argument relating to eligibility of payment of gratuity that if an employee has completed 4 years of service but has not completed 5 years of service whether he is eligible for gratuity. People seem curious about eligibility for the gratuity of an employee that who completes 4 years and 240 days of service he is eligible for gratuity as it was pronounced by Madras High Court. In our opinion, it is better to rely upon Section 4(2) of the Payment of Gratuity Act which provides that for every completed year of service in excess of six months, the employer shall pay gratuity to an employee. That means if an employee works in the establishment for more than 6 months in a year, he shall be eligible to get gratuity at the prescribed rate. So, if an employee completes 4 years and 6 months of continuous service in the same establishment, he is eligible to get gratuity as per the Payment of Gratuity Act 1972.

Therefore, it is desirable to consider that the Payment of Gratuity Act is a social welfare legislation and it may be given a liberal interpretation in offering benefits to employees who have completed more than 4 years and but less than 5 years but falls within 180 days in the 5th year. Hence, an employee who has completed 4 years and 6 months continuously without any break may preferably be eligible for Gratuity under the Act.

24 Comments

  1. Hi,

    I have completed 4 years 6 months and 5 days in Wipro. But they are denying me the gratuity, how to proceed in this case.

  2. I have completed 4 years 6 months 19 days service in an organization. Organization works 5 days a week. So am I eligible for Gratuity?

  3. Hi,

    I have completed 4 years 6 months and 13 days in current company but I am not getting my gratuity because of not completing 5 years of service.

    Joining date: 09-Feb-2015

    Last working day: 22-Aug-2019

    Could you please advise how can I move forward with this issue.

    Thanks,
    Balaji

  4. what is the meaning of this? (continuously without any break may preferably be eligible for Gratuity under the Act)

  5. Sir I am join 9 janvery 2015 and my last working day including notice period is 30 aguest 2019. Is I am eligible for gretuity in limited company

  6. I have completed four years is IBM and now I am in to the fifth year so after completing six months (march 2020) will I be eligible to get gratuity if resign my job in next year april or may
    )

  7. Dear
    I have completed my service in an IT firm for the period 4 years 6 months 23 days without any service break and it was 5-day per week working. Now my company HR is telling me that since I have not completed my service for 5 years or 4 years 8 months, I will not get the Gratuity amount. Please, can you let me know whether I am eligible to get the gratuity amount? If so please can you let me know where I can get support documents or evidence or who can help me out?

  8. I joined a multi-national organization (A) in October 2014 which was not incorporated in India. It was in collaboration with another company (B) in India and I was employed formally in that other company B but I was working completely for A. My company A got finally incorporated in 2015 and I formally became the permanent employee of company A in July 2015. Now, I have resigned from the company A and my last date will be January 7th, 2020. Will I be eligible for gratuity or not? I am a legal employee of Company A for 4 yrs 6 months (till y last day) but have completed 5+ years in October 2019 since I started working for company A. Please provide your guidance on this.

  9. Thanks for this informative article. I just have one query: does this 180 days in the fifth year include weekend (Saturday and Sunday) as well. Will I be eligible for gratuity if my fifth year starts in July 1st, 2019 and ends on January 7th, 2020 (my last working day in my current organization). Your response would be extremely helpful. Thanks.

  10. Hi my name is shailesh and i m working is well known company i have completed 4 years and 6 month in same company. so, will get the gratuity ?????

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