Burdensome Procedural Norms Under Payment of Gratuity Act, 1972

An Overview of Procedural Norms The Payment of Gratuity Act, 1972 read with the Payment of Gratuity (Central) Rules, 1972 provides for a complex procedure when it comes to application for and processing of gratuity payments. Procedural norms under Section-4 of the Act stipulate that gratuity shall be paid to an employee on the termination of his employment after he has rendered continuous service for not less than five years. Section 2A of the Act…

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Proposed Reforms to the Payment of Gratuity Act, 1972

Introduction The roots of the term gratuity can be traced to the French word gratuité or from the Latin term gratuitus, both the terms loosely mean the voluntary payment of money for favour or services. At its most basic level, payment of gratuity is a sum tendered to employees following longevity of service and is generally paid towards their retirement fund. In foreign countries it is also used synonymously with tipping, however, in India it…

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