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You heard right!
If you are an employee working in any Company/ entity (having the more than 10 employees) and thinking why government doesn’t think for my future. Then here is a good news for you.
Modi government gives another gift by increasing the gratuity limit to Rs. 20 lakh from Rs. 10 lakh after the recommendation made by the 7th pay commission panel. It was done after the three-party meeting between the Central government, state representatives and the central trade unions.
The central trade unions agreed on doubling the tax-free gratuity limit as an interim measure in the meeting on the proposed amendment to Payment to Gratuity Act.
The trade unions were also demanding the removal of having at least 10 employees in an organization. In addition to that union was not satisfied with the law that there must be minimum 5 years of service for payment of gratuity. They also wanted the rate of 15-day wages for each completed year should be raised to 30 days.
The All India Trade Union Congress (AITUC) said in a statement that “While accepting the maximum payment limit of Rs 20 lakh as an interim measure, the unions demanded that the ceilings/ limit with respect to number of employees and years of service should be removed “
The amendment of the provision was notified on 25 July 2016. It should be made effective from the January, 1 2016 for central government employees.
The unions were little disappointed after the meeting saying the latest amendment only deals with increasing the limit of under the Section 4(3) of the gratuity act from 10 lakh to 20 lakh but not putting emphasis on the other things.
The employers and the state representatives were also happy with the decision.
So now you have some good news for this weekend. We hope that government will take more steps for providing a stable future to the employees.
If you have any queries related to that, You can Contact Us
Just thinking how much your gratuity would be! Or, to learn more about gratuity, go to our Gratuity calculator tool
