The Lok Sabha on Thursday passed the Payment of Gratuity (Amendment) bill which seeks to empower the government to fix period of maternity leave and tax-free gratuity amount with an executive order. After the passage of the Payment of Gratuity (Amendment) Bill in the Rajya Sabha, the government would be able to enhance the ceiling of tax-free gratuity to Rs 20 lakh from existing Rs 10 lakh for an employee under the Payment of Gratuity Act.
After implementation of the seventh Central Pay Commission, the ceiling of gratuity amount for central government employees was increased from Rs 10 lakh to Rs 20 lakh. The unions are demanding for the inclusion of the change into the Act. The bill was passed amid the din in the Lok Sabha on Thursday as the uproar over a host of issues went for the second week in a row.
The Payment of Gratuity Act, 1972, was enacted to provide for gratuity payment to employees engaged in factories, mines, oilfields, plantations, ports, railway companies, shops or other establishments.
The law is applicable to employees, who have completed at least five years of continuous service in an establishment that has 10 or more persons.
After implementation of the seventh Central Pay Commission, the ceiling of gratuity amount for central government employees was increased from Rs 10 lakh to Rs 20 lakh. The unions are demanding for the inclusion of the change into the Act. The bill was passed amid the din in the Lok Sabha on Thursday as the uproar over a host of issues went for the second week in a row.
The Payment of Gratuity Act, 1972, was enacted to provide for gratuity payment to employees engaged in factories, mines, oilfields, plantations, ports, railway companies, shops or other establishments.
The law is applicable to employees, who have completed at least five years of continuous service in an establishment that has 10 or more persons.
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