GRATUITY

SUBMITTED TO ; MAAM

BENEFITS
SUPERRANUATION PROVIDENT FUND GRATUITY LONG TERM BENEFITS LEAVE ENCASHMENT

EMPLOYEES PROVIDENT FUND SCHEME

EMPLOYEES DEPOSIT LINKED INSURANCE SCHEME

EMPLOYEES PENSION SCHEME

Meaning of word gratuity

The word GRATUITY has been derived from the word GRATUITY Gratuitous which mean Gift or Present

It is a lump sum payment made by an employer as the retrial reward for his past service when his employment is terminated.

Historical background
Govt of keralas legislation for Payment of gratuity 3rd June 1971 introduced the Ordinance ,wherein scheme Was enacted Labour ministral conference Held at New Delhi 1971

Ordinance replaced by west Bengal

According the payment Of gratuity bill was introduced In a parliament

Flow of the payment of gratuity act 1972

Extent and application Definitions Continuous service

Controlling authority Payment of gratuity Compulsory insurance Power to exempt and nomination

Objects of the act

Every factory, mine, oilfield, plantations, port and railway company; Every shop or establishment within the meaning of any law for the time being in force in relation to shops and establishments in a state, in which 10 or more persons are employed, or were employed, on any day of the preceding 12 months; Such other establishments or class of establishment in which 10 or more employees are employed, or were employed, on any day of the preceding 12 months as the central govt. may, by notification specify in this behalf..

Application for the payment of gratuity (sec7)

Application can be made by:
An employee who is eligible for payment of gratuity. Any person who is authorized in writing by such employee. Nominee of the employee( if the deceased employee had made a nomination) Legal heir of the employee ( if the deceased employee had not made a nomination)

Payment of gratuity
Time limit within 30 days of gratuity becoming payable. Maximum amount the gratuity payable to an employee shall not exceed Rs10,00,000. Under the terms of an award ,settlement or contract, an employee may be entitled to better terms of gratuity .such an award or settlement or contact shall be valid and effectual.

How is gratuity calculated

Salary= basic pay + dearness allowance
Your last drawn monthly salary

15

gratuity

1 month = 26 days

Number of years in service

Mr.ram worked in a xyz company for 4 years 11 months . Do you think he is eligible for gratuity ????????

Eligibility for Gratuity: Five years of Continuity service. Even though service is 4 yrs 11 months, he / she is not eligible for Gratuity. Gratuity Formula: Last drawn Basic/26*15 days * No of years service completed If service is 5 yrs 6 or 7 months, Gratuity should be calculated for 6 yrs.

To which limit gratuity is payable?? 3,50,000 10,00,000 At what rate gratuity is payable? 10 15 20

What is the formula for calculating gratuity???

Provident fund
In 1952 ,the employees provident funds act was introduced for welfare legislation for the purpose of instituing a Provident Fund for employees working in factories and other establishments.

objective
It aims at providing social security and timely monetry assistance to industrial employees and their families and to protect them in oldage, disablement,early death of bread winner and in some other contigencies

APPLICABILITY OF THE ACT

To every factory employing 20 or more persons. Any establishment to which the Act applies shall continue to be governed by the Act even if the number of persons employed therein at any time falls below.

Exemption of the act

Any establishment under the co-operative societies act. To any other establishments set up to whose employees are entitled to the benefits of contibutry provident fund and old age pensions. To any other establishment newly setup, until to a expiry of 3 years from the date of set up.

The Employees Provident Funds Scheme, 1952

Applicability : Every employee employed in or in connection with the work of a factory or other establishment covered by the schemes other than an excluded employee is entitled and required to become a member of the fund from the date of joining the factory or establishment.

contribution
1.Employees : 12% on Basic + DA 2. Employer : (a) 3.67% on Basic + DA (b) Administrative Charges : 1.10% on Basic +DA

The Employees DepositLinked Insurance Scheme, 1976

Purpose : To provide life insurance benefits to the employees of the establishments covered by the EPF & MP Act, 1952

contribution
1. Employees : Not required 2. Employer : (a) 0.5% on Basic + DA (b) Administrative Charges : 0.01% on Basic +DA Where the monthly pay of an employee is more than Rs. 6,500 the contribution payable in respect of him by the employer is limited to the amts payable on a monthly pay of Rs. 6,500 only.

Benefits of EDLI scheme

The benefit provided under the scheme in the nature of life insurance as follows: 1. On the death of an employment while in service a lump sum insurance amount is payable to his nominee or family members. 2. The insurance amount is equal to the average balance in the account of the deceased employee in the Provident Fund during a period of 12 months immediately preceding his death. In case the average balance exceeds Rs.35,000/- the insurance amount payable is Rs. 35,000/- plus 25% of the amount in excess of Rs. 35,000/subject to a ceiling of Rs. 60,000/-.

The Employees Pension Scheme, 1995

Purpose: The purpose of the scheme is to provide for (1) superannuation pension, retiring pension or permanent total disablement pension to employees covered by the Employees Provident Funds and Miscellaneous Provisions Act, and (2) widow or widowers pension, children pension or orphan pension payable to the beneficiaries of such employees.

contribution
1. Employee: Not required 2. Employer : (a) 8.33% on Basic + DA It is to be noted that where the pay of the member exceeds Rs. 6,500/- per month, the contribution payable by the employer will be limited to the amt. payable on his pay of Rs. 6,500/- only.

DETERMINATION OF MONEYS DUE FROM EMPLOYERS,THEIR RECOVERY AND EMPLOYEES PROVIDENT FUNDS APPELATE TRIBUNAL:
In case where a disputes arises -determining the due amount from any employer * Central P.F. Commissioner, - Additional Central P.F. Commissioner, - Deputy Central P.F. Commissioner have rights to conduct enquiry and make necessary claim from the employer Review of orders passed under Sec. 7-A - The officer made some mistake or error apparent on the face to the record. Review his order if he is satisfied. Determination of escaped amount

How many schemes are there under the provident fund act??? 3 4 5

Membership of the fund is compulsory for the employees drawing 6500 5500 7500

This act applicable to establishments employing 20 25 30

Difference between provident fund and gratuity

BASIS
CONTRIBUTION ELIGIBILITY

PROVIDENT FUND

GRATUITY

BOTH EMPLOYER AND ONLY EMPLOYER EMPLOYEE CONTRIBUTE CONTRIBUTE STARTS FROM THE DAY YOU WILL BE PAID AFTER YOU JOIN THE COMPLETING 5 YEARS ORGANISATION AT THE TIME OF RETIREMENT CAN BE CARRIED ON EVEN IF U QUIT YOUR OLD JOB NO MAXIMUM LIMIT AT THE TIME OF LEAVING THE ORGANISATION CANNOT BE CARRIED ON AS IT IS SPECIFIC MAX LIMIT UPTO 10,00,000

PAYABLE

CONTRIBUTION

LIMIT

APOORVA

ASHIMA BHARTI

THANK YOU