In this case , the Madras High Court decided about the eligibility of employees who completed 4 year ,10 months and 18 days service for gratuity eligibility under section 2 (a), 2 (b), 2(c),2(e), and 2 A under the Payment of Gratuity Act ,1972.
Section 4 of the Payment of Gratuity Act, 1972 provides that an employee will entitled to gratuity on completion of continuous service of 5 years and while clarifying the 5 years complete service, Andhra Pradesh Hight Court in P. Raghuvulu and Sons v. Additional Labour Court , [1985] , had held that the minimum period for becoming eligible for payment of gratuity should not be less than 5 years since it should be complete 5 year service.
It was further clarified that the words or part in excess of six months' are only meant for the purposes of computation of gratuity for the subsequent year or years to first complete 5 years. It was also held that if an employee has worked for 4 years 11 months and 10 days, he will not be eligible for gratuity for want of completion of 5 years.
Further in a subsequent case, MADRAS HIGH COURT while relying upon the clarification by the SUPREME COURT pertaining to 240 working days in one year will be deemed to be continuous service of one year meaning thereby that there should not be complete 12 calendar months' service. MADRAS HIGH COURT has further held that an employee, who has put in service of 4 Years 10 Months and 18 Days in the 5 years, will be entitled to gratuity.
The gratuity act says continued services . In this case , there is continuity in service.
Further , as per SC , a year means 240 working days.
Since the employee who has completed 4 years 10 months and 18 days is eligible for gratuity as he has put in service of 5 years continuously as per SC explanation.
To , gratuity act is a social welfare act and one should have liberal interpretation offering benefits to employees who had put more than 4 years and but less than in 5 years but falls within 240 days in the 5th year.
SC applied liberal interpretation of the Act and had given benefits to the employee.
Hence , an employee who has completed 4 years 10 months and 18 days continuously without any break is eligible for Gratuity under the Act.
Further , as per SC , a year means 240 working days.
Since the employee who has completed 4 years 10 months and 18 days is eligible for gratuity as he has put in service of 5 years continuously as per SC explanation.
To , gratuity act is a social welfare act and one should have liberal interpretation offering benefits to employees who had put more than 4 years and but less than in 5 years but falls within 240 days in the 5th year.
SC applied liberal interpretation of the Act and had given benefits to the employee.
Hence , an employee who has completed 4 years 10 months and 18 days continuously without any break is eligible for Gratuity under the Act.
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