Rules
1. Payment of Gratuity:
The employer shall arrange for the payment of gratuity within 30 days from the date it becomes payable, to the person to whom it is payable. [Sec. 7 (3)].
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2. Payment of Interest |Sec. 7(3 A)]:
If the amount of gratuity payable by the employer is not paid within 30 days, the employer shall pay simple interest at such rate not exceeding the rate notified by the Central Government from time to time for payment of long term deposits.
ADVERTISEMENTS:
The interest shall be payable from the date on which gratuity is payable and to the date, it is actually paid.
If there is a delay in paying the amount of the gratuity payable due to the fault on the past activity of the employee, no interest shall be payable provided the employer has obtained permission from the controlling authority.
3. Payment of Gratuity in case of Dispute [Sec. 7(4)]:
If there is any dispute as to (a) the amount of gratuity payable to the employee, (b) the admissibility of any claim of, or in relation to, an employee for the payment of gratuity or (c) the person entitled to receive the amount of gratuity, the employer shall deposit the amount of gratuity as he admits to be payable, with the controlling authority. [Sec. 7(4)].
Where there is dispute with regard to any matter or matters specified above, the employer or the employee or any other person raising the dispute can make an application to the controlling authority for deciding the dispute. [7(4)(b)].
ADVERTISEMENTS:
The controlling authority, on making an application, shall after due inquiry and after giving the parties to the dispute a reasonable opportunity of being heard determine the matter or matters in dispute.
If as a result of such enquiry, it is found that any amount is payable to the employee, the controlling authority shall direct the employer to pay such amount or as the case may be, such amount as reduced by the amount deposited with the controlling authority by him. [Sec. 7(4) (c)].
The controlling authority shall pay the amount, deposited with him by the employer including the excess amount, if any deposited, by the employer to the applicant i.e., the employee or the nominee or the heir of the employee. As soon as may be, after a deposit is made by the employer, the controlling authority shall pay the amount of deposit –
(a) To the employee if application is made by the employee.
ADVERTISEMENTS:
(b) To the nominee, guardian of the nominee, the heirs if the applicant is not an employee.
If the controlling authority is satisfied there is no dispute as to the right of the applicant to receive the amount of the gratuity.
Thus, the controlling authority shall decide the dispute, if any as to the payment of gratuity and shall make the arrangement for its payment to the applicant.