If you change your company, you will get the option of gratuity transfer, know everything about it

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gratuity transfer

New Delhi: The central government is planning to start a new system for salaried workers soon. Under this, employees can also get a chance of Gratuity Transfer on changing jobs just like the Employee Provident Fund (EPF). For this, an agreement has been agreed between the Central Government, the Employees Union and the industry to change the existing gratuity structure. Gratuity transfers will now be included in the rules related to the Social Security Code.

Final notification may come next month
According to information received from sources, now like the Provident Fund, the jobbers will also get the option of gratuity transfer. Gratuity transfer arrangement will be applicable in case of change of job, after agreement on gratuity portability in industry and employee unions. With this, gratuity contribution has also been agreed to every month like PF. According to sources, this agreement has been reached in the meeting of Labor Ministry-Union-Industry. It is also proposed to make gratuity an essential part of CTC. This provision will be included in the rule of the Social Security Code. According to sources, the final notification on this is possible in April 2021.

gratuity transfer

Not agreeing on extending the industrial working day
The industry has not got the consent to extend the working days for gratuity. The industry disagrees with the proposal to make the working day 15 days to 30 days for gratuity. Explain that an employee working in a company for 5 years continuously, the salary, apart from salary, pension, and provident fund, is called gratuity. A small part of it keeps getting deducted from the salary of the employee. At the same time, the company gives a large part of gratuity on its behalf. This is in a way a long-term benefit of the company.

This is how the amount of gratuity is fixed
The gratuity received by any employee depends on two things. First, how many years the employee has worked in the same company. A person working for at least 5 years in the same company gets a gratuity. At present, there is a fixed formula for fixing gratuity. Accordingly, (last salary) x (15/26) x (5) = amount of gratuity. Now suppose the last salary of someone is 50 thousand rupees, then his gratuity will be (50,000) x (15/26) x (5) = Rs 1,44,230. Here only 26 days are kept in the month because it is believed that 4 days is a holiday. At the same time gratuity is calculated on the basis of 15 days in a year. Secondly, how much are the basic salary and dearness allowance in his last salary?

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