Key Amendments In Payment Of Gratuity Act

The payment of Gratuity Act, came into existence on 21st August, 1972. The Act applied to only certain establishments prior to its amendment. The gratuity was paid to persons who are covered within the meaning of the term 'employee' under section 2(e) of the Act, subject to the conditions mentioned in Section 4 of the Payment of Gratuity Act, 1972.

The Payment of Gratuity Act, 1972 applies to the establishments employing 10 or more persons. The main purpose for enforcing this Act is to provide social security to workman after retirement, whether retirement is a result of superannuation, or physical disablement or impairment of body parts. Therefore, the Payment of Gratuity Act, 1972 is an important social security legislation to wage earning population in industries, factories and establishments. It is a welfare act and envisioned to those workman who renders their service for long period of time and they were considered as faithful employees. The employee has to