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Section 2A, Payment Of Gratuity Act 1972: Continuous Service

Section 2A of the Payment of Gratuity Act, 1972 — 'Continuous service', reads as follows:

For the purposes of this Act,—
(1) an employee shall be said to be in continuous service for a period if he has, for that period, been in uninterrupted service, including service which may be interrupted on account of sickness, accident, leave, absence from duty without leave (not being absence in respect of which an order treating the absence as break in service has been passed in accordance with the standing orders, rules or regulations governing the employees of the establishment), lay-off, strike or a lock-out or cessation of work not due to any fault of the employee, whether such uninterrupted or interrupted service was rendered before or after the commencement of this Act;

(2) where an employee (not being an employee employed in a seasonal establishment) is not in continuous service within the meaning of clause (1), for any period of one year or six months, he shall be deemed to be in continuous service under the employer—

 (a) for the said period of one year, if the employee during the period of twelve calendar months preceding the date with reference to which calculation is to be made, has actually worked under the employer for not less than—
   (i) one hundred and ninety days, in the case of an employee employed below the ground in a mine or in an establishment which works for less than six days in a week; and
   (ii) two hundred and forty days, in any other case;

 (b) for the said period of six months, if the employee during the period of six calendar months preceding the date with reference to which the calculation is to be made, has actually worked under the employer for not less than—
   (i) ninety-five days, in the case of an employee employed below the ground in a mine or in an establishment which works for less than six days in a week; and
   (ii) one hundred and twenty days, in any other case.

Explanation.—For the purposes of clause (2), the number of days on which an employee has actually worked under an employer shall include the days on which—
 (i) he has been laid-off under an agreement or as permitted by standing orders made under the Industrial Employment (Standing Orders) Act, 1946 (20 of 1946), or under the Industrial Disputes Act, 1947 (14 of 1947), or under any other law applicable to the establishment;
 (ii) he has been on leave with full wages, earned in the previous year;
 (iii) he has been absent due to temporary disablement caused by accident arising out of and in the course of his employment; and
 (iv) in the case of a female, she has been on maternity leave; so, however, that the total period of such maternity leave does not exceed such period as may be notified by the Central Government from time to time;

(3) where an employee, employed in a seasonal establishment, is not in continuous service within the meaning of clause (1), for any period of one year or six months, he shall be deemed to be in continuous service under the employer for such period if he has actually worked for not less than seventy-five per cent. of the number of days on which the establishment was in operation during such period.





Extra Notes for Readers

(1) Section 2A was inserted by Act 26 of 1984, s. 4 (w.e.f. 18-May-1984).

(2) In sub-section (1), after the words "of which an order" - the words "imposing a punishment or penalty or" were omitted by Act 22 of 1987, s. 3 (w.e.f. 1-Oct-1987).

(3) The "Explanation" part under sub-section (2) was inserted by Act 22 of 1987, s. 3 (w.e.f. 1-Oct-1987).

(4) In item (iv) to Explanation under sub-section (2), the words "such period as may be notified by the Central Government from time to time" were substituted for the words "twelve weeks" by the Payment of Gratuity (Amendment) Act, 2018 (12 of 2018), s. 3, (w.e.f. 29-Mar-2018).






This page was last updated on 29th March 2018.

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