Gratuity Act raises unions’ hackles
The Payment of Gratuity (Amendment) Act, 2010, which was passed by Parliament in its last session, has raised the hackles of various trade unions.
The Act has raised the maximum limit of gratuity payable to an employee from Rs 3.5 lakh to Rs 10 lakh. Then why are the trade unions angry? It is the date of implementation of the Act, which has annoyed workers engaged in the private sector, public sector undertakings and the banking sectors, among others.
The upper limit of the gratuity for government employees was raised to Rs 10 lakh with effect from January 1, 2006, when the recommendations of the Sixth Pay Commission came into effect.
Immediately after that various trade unions demanded that a similar provision should be made for the employees of the private sector and public sector undertakings.
Conceding the demand, the government introduced the Payment of Gratuity (Amendment) Bill in Parliament. While passing the Bill, Parliament said the Act would come into force on such date “as the Central Government may, by notification in the official gazette appoint.”
The Act received the assent of the President on May 17 last and the Union Ministry of Labour and Employment notified it on May 24, stating that the Act would become effective from that day.
The trade unions say the notification is discriminatory. While for the government employees the maximum limit of gratuity has been revised with effect from January 1, 2006, for those of the private sector and the public sector undertakings it would be from May 24. Thus, the employees of these sectors, who retired between January 1, 2006 and May 24, 2010, would be sufferers.
SR Khatri, general secretary of the State Bank of India Employees Organisation, said the government had yielded to the pressure of various organisations of private employers, who did not want to pay enhanced gratuity to their employees retiring before May 24. He said the trade unions would agitate against this discrimination.
TN Goel, president of the State Bank of Indian Officers Federation, said it was highly unfair to the employees of the public sector banks, whose pay was revised with effect from November 2007. The notification should have taken care of this fact.
State secretary of the Haryana CITU Surender Malik said the enhanced gratuity should be payable to all with effect from January 1, 2006. He also demanded that various retirement benefits should not be subject to income tax.
Source: Tribuneindia
IT IS VERY UNFAIR ON THE PART OF GOVT OF INDIA TO TAKE A DECISION NOT TO PAY THE GRATUITY WITH RETROSPECTIVE EFFECT I.E.,010106 AS IT HAS BEEN PAID TO CENTRAL GOVT EMPLOYEES. ALL THE OTHER PRIVATE AND PSUS SHOULD AGITATE FOR THIS PARTIALITY OF GOVT OF INDIA LABOUR MINISTRY.THE ARREARS OF GRATUITY SHOULD BE PAID TO ALL ELIGIBLE EMPLOYEES WITH RETROSPECTIVE EFFECT.ALL THE TRADE UNION LEADERS SHOULD THINK OVER THIS AND DO JUSTICE TO THEIR EMPLOYEES AS IMMEDIATELY AS POSSIBLE. T.K.RAO. KAKINADA. A.P.
ReplyDeleteyou have to fight for the injustice done to retired people not only for the effective date for revised gratuity amount, but also for 50% of Last drawn BASIC pay to the retires. the Banking fraternity should understand that one day they also will retire...donot cry then.
ReplyDeleteThe Gratuity Amendment Act 2010 is confusing as 6th CPC says effective date is 01.01.2006 and dpe who is a nodal agency for govt. cpse's says effective date is 01.01.2007. Does the above Act of 2010 over rule the orders stated by DPE. Please inform as I am just too worried as we will be losing a huge amount of Rs.6.5 lakhs. Truely, then this is very unfair of the Govt.
ReplyDeleteIt is most unfortunate that we the retirees of Central GOVT. CPSU's working under the guidelines of the DPE have come in for a rude shock. The Govt. initially approved the 2nd pay revision on 26.11.2008 by approving the enhanced gratuity of Rs.10 lakhs w.e.f. 01.01.2007. What made them change their minds? If the 6th CPC gratuity is to be implemented from 01.01.2006, then why this step motherly treatment to us? Are'nt we paying the same taxes as them? Hon. PM and FM, please look into this aspect as we have become easy targets and have lost out on Rs.6.5 lakhs which we were eagerly looking forward to.
ReplyDeleteEvery body agrees that this is discriminatory: But how to correct this quickly? How to make the grivence of retired employees heard in the corridors of law makers; Only print media/visual media or employees organisations can only take the issue to that level. The hands of common citizen are not that lenghty to reach the corridor of law makers. Justice delayed is justice denied.
ReplyDeleteIt is unfortunate that the additional gratuity of Rs 6.5 lcspaid to CPSU employees before May 24, 2010 is taxable whereas it is tax free for people retiring on orafter May 24, 2010. this is a discrimination. The law should be same for every one. gratuity amount is one on which retired employees plan for their rest of the life. Why it should be taxed for employees who have retired before may 24, 2010.?
ReplyDeleteThe Monsoon session of Parliament will begin on July 26. We request the print media/visual media/employees organisations/Hon M.Ps, to take the issue to that level. Let us prey God.
ReplyDeleteInjustice in tax treatment on gratuity payment to psu officers:-Our tax consultant are advising to file writ in SC against the deduction of Income Tax on gratuity recieved before May 2010 by the PSU employees for the enhenced amount above 3.5 Lakhs.They are confident that it will go in the favour of Psu officer . Let us unite and file the case jointly.
ReplyDeleteThe Bank employees retired between 1.1.2006 to 23.05.2010 have lost their life time savings due to Labour Ministry notification stating effective date as 24.05.2010.Discrimination on retirement benefits is beyond any body comprhension. Why the press/visual media do not highlight such discriminations?.why retired employees are put to mental torture even after retirement:Are they not entitled for peaceful retirement?.We appeal to the Public Sector Trade Unions to take up the issue through our Hon M.Ps, to deal with the Govt, which is reluctant to come to grips with reality.
ReplyDelete