Gratuity Application

APPLICATION FOR PAYMENT OF GRATUITY (Application by an employee under Section 4 read with Section 7 of the Payment of Gratuity Act, 1972) To, The Employer / Controlling Officer [employer_name] [employer_address] Date: [application_date] Sir/Madam, 1. PARTICULARS OF THE APPLICANT Name : [employee_name] Employee ID : [employee_id] Designation held : [designation] Address : [employee_address] 2. PARTICULARS OF SERVICE Date of joining : [joining_date] Date of leaving : [leaving_date] Reason for cessation : [reason_for_leaving] Completed years of service : [years_of_service] Last drawn wages (basic + DA) : Rs. [last_drawn_wages] per month 3. That I was employed with [employer_name] for the period stated above, and rendered continuous service within the meaning of Section 2A of the Payment of Gratuity Act, 1972. 4. That I have completed the qualifying period of continuous service prescribed under Section 4 of the Act, and gratuity has become payable to me on the cessation of my employment. 5. I therefore apply for payment of the gratuity due to me, computed in accordance with Section 4(2) of the Act. 6. PAYMENT DETAILS Kindly remit the amount to the following account: [bank_details] 7. I request that the amount be determined and paid within the period prescribed under the Act, and that I be furnished with a statement showing the computation. 8. I undertake to furnish any further particulars or documents that may be required. Yours faithfully, [employee_name] [designation] (former) Employee ID: [employee_id] ACKNOWLEDGMENT BY THE EMPLOYER Received on ______________ Signature and seal: ______________________ HOW GRATUITY IS CALCULATED For an employee covered by the Act, the formula under Section 4(2) is: Gratuity = Last drawn wages × 15/26 × Completed years of service where "wages" means basic wages plus dearness allowance, "15/26" reflects fifteen days' wages calculated on a twenty-six day month, and service in excess of six months in the final year is rounded up to a full year. The total is subject to the CEILING PRESCRIBED UNDER THE ACT, which has been revised from time to time. Confirm the ceiling currently in force. WHAT THE ACT ENTITLES YOU TO — WORTH KNOWING QUALIFYING PERIOD — gratuity is payable on cessation of employment after FIVE YEARS of continuous service. That condition does NOT apply where employment ends due to death or disablement, in which case gratuity is payable regardless of the length of service. APPLICATION IS NOT A PRECONDITION — Section 7(2) obliges the employer to DETERMINE the amount of gratuity and give notice to the employee AS SOON AS IT BECOMES PAYABLE, whether or not an application has been made. An employer cannot lawfully withhold gratuity on the ground that no application was filed. TIME FOR PAYMENT — the employer must arrange to pay the amount within THIRTY DAYS of it becoming payable. INTEREST ON DELAY — where payment is not made within that period, the employer is liable to pay SIMPLE INTEREST on the amount from the date it became payable until the date of payment, at the rate notified by the Central Government. DELAY IN APPLYING IS NOT FATAL — the rules prescribe a period within which an application should be made, but an application made after it must still be entertained if the employee shows sufficient cause for the delay. An employer cannot refuse gratuity solely because the application was late. FORFEITURE IS LIMITED — Section 4(6) permits forfeiture only in the specific circumstances set out there, and even then only to the extent of the damage or loss caused, or in cases of specified misconduct. Blanket forfeiture on resignation or on a dispute with the employer is not permissible. IF PAYMENT IS REFUSED OR DELAYED — apply to the CONTROLLING AUTHORITY appointed under the Act for the area, which has power to determine the amount and to direct payment with interest. An appeal from that order lies to the appellate authority.