Private employees: If you work in a private company, then there is great news for you. Now you can get a gratuity transfer like PF if you change company. On joining one company and leaving the other, the way PF money is transferred to that company, similarly, the gratuity money will also be transferred. Actually, an agreement has been reached between the government, union, and industry on the change in structure and it can be implemented soon. According to a report by CNBC Housing, private sector employees will get the option to transfer gratuity like PF. Once the agreement on gratuity portability is agreed, the gratuity will be transferred like a PF on a job change.
Possibility of notification soon
According to the media report, this government can soon issue a notification on this decision. The proposal to make gratuity a part of CTC has been discussed in the meeting of the Union Ministry of Labor and Industry. This provision will be included in the Social Security Act. However, the industry has not agreed to extend the working days on this. The industry has not agreed to the proposal of 15 to 30 working days for gratuity.
Lakhs employees will get relief
As we know people change jobs many times in their life due to one or the other reason. Especially in the private sector, it is seen that if a person is working in this company today, then after a few days or a few years, it is seen in another company or institute. In such a situation, along with changing the institution, his PF also keeps on transferring, but the amount of gratuity is not transferred, now there can be an opportunity of gratuity transfer like PF if you change the company. In such a situation, millions of crores of employees working in the private sector will get relief.
What is employee gratuity?
An employee becomes entitled to gratuity after working for 5 years or more in any company. Under the Payment of Gratuity Act 1972, a company is required to pay gratuity to its employee but private-sector employees do not know about it and hence cannot receive payment.
When will the employee get the payment of gratuity?
– the retiring employee.
– An employee working in the same company for a minimum period of 5 years or more, if he leaves the job or is removed from the job.
– In case of death or disability due to sickness or accident.
How is gratuity calculated?
If a person has worked in the same company for 20 years. His last salary is 75000 rupees (basic and DA) inclusive. Here 26 days in a month are counted because 4 days is a holiday. At the same time gratuity calculation is done on the basis of 15 days in a year. Money of total gratuity – 75000 rupees x (15/16) x 20 = 865385 rupees.