Payment of Gratuity Act - Amendments 2010

The Cabinet on Thursday approved an amendment to the Gratuity Act to raise the ceiling from Rs 3.5 lakh to Rs 10 lakh. The Bill to amend the Act will now go to Parliament, a government official told FE.

Every salaried person, who has completed five years of government or private sector service, is eligible for half a month's salary as gratuity for every completed year of service. But the gratuity pay of those with higher salaries is now limited at Rs 3.5 lakh. The proposed amendment raises this to Rs 10 lakh. Every employer with more than ten salaried workers is mandated to provide gratuity to the eligible employees. Many companies, however, do not keep the gratuity liability adequately funded. That is, they make provisions for future payment, but do not set aside funds towards the future payment. Listed companies are expected to disclose their gratuity liability.

Meanwhile, the Cabinet Committee on Economic Affairs (CCEA) approved a proposal of India Infrastructure Development Fund Ltd (Mauritius) to raise contributions from international investors and invest in the India Infrastructure Development Fund. The proposal, earlier approved by the FIPB, will result in FDI exceeding Rs 750 crore.

The Cabinet approved the proposal of the shipping ministry to declare Andaman and Nicobar set of ports as major port and establish the Andaman and Nicobar Port Trust with its headquarters at Port Blair.

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Jet Airways - Violations under IDA

New Delhi, Oct 16: With panic spreading across the industry after the retrenchment of 1900 staff by the Jet Airways as a cost cutting measure, the Chief Labour Commissioner on Thursday submitted report to the Labour Ministry regarding the lawfulness of the step taken by the company in shedding off its employees.

Speaking about the legality of the move, the Deputy Chief Labour Commissioner of Maharashtra and Goa said that “altogether 700 of the 1,900 retrenched Jet Airways employees were on probation with less than one year of service record”.

However, the government is likely to look into the sacking of the remaining employees, Labour Secretary Sudha Pillai said.

"As per law, probationers below one year of service can be retrenched without serving any notice. So, there is no violation of law. We are looking into the matter of the remaining employees who were sacked. So far, the Labour Commissioner there have not received any complaint from anyone," Pillai said.

Provisions under the Industrial Disputes Act states that employees who have completed their probationary period can approach the Labour Commissioner's office to seek justice for undue removal from service.

"If we receive any complaints it will be dealt as per provisions under Section 25(O) of the Act. So far, there are none. Hence, we can do nothing about it but feel sad for them," Pillai added.

The Deputy Chief Labour Commissioner in a letter to the Government said “All retrenched staff, including the probationers -- 578 cabin crew and 120 ground staff -- have been a paid a month's salary apart from returning their security deposits.”

However, the Labour Ministry is yet to learn about the employment status of the remaining 1,200 sacked Jet Airways employees, though officials here said the issue is in the Civil Aviation Ministry's ambit.

"Cost of running an airline is high owing to high ATF prices. As far as the government is concerned, the issue is in jurisdiction of the Aviation Ministry and they will look further into it," a top ranking ministry official said.

Source : Zeenews Bureau