Entitlement To Gratuity Not Lost By Merely Opting To Extend Retirement Age To 60 Years

KEY TAKEAWAYS

• Recently, the Supreme Court has observed that entitlement to gratuity is not lost by merely opting for extension of retirement age to 60 years.

DETAILS

• Name of the case : G.B. Pant University Of Agriculture And Technology V. Sri Damodar
• Foundation of the Case

1) G.B. Pant University Of Agriculture And Technology ("University") had approached the High Court set upon the judgment and orders dated November 22, 2016 passed under the Payment of Gratuity Act, 1972, by the Appellate Forum and order dated January 19, 2013 passed by, the Controlling Authority under the Payment of Gratuity Act, 1972.

2) The issues before the High Court were - Whether the benefit under the Payment of Gratuity Act, 1972 ("Act") would be accessible to the employees of the University? ; As to what in particular would be the impact of there being no exemption from applicability of Act u/s 5 r/w Section 14 of the Act? ; Up to which degree the beneficial legislation could be implemented on the employees of the University?

COURT PROCEEDINGS

1) The bench of Justice Sharad Kumar Sharma saw that in compatibility to the exercise of option by a representative to profit the benefit of extending the retirement age to 60 years for payment of gratuity under the Act, was not planned to deny gratuity to the optees.

2) "Exercising of an option would not deprive the private respondent of gratuity until and unless it had been exempted after a prior approval of the State Government," the Court said.

QUESTIONS

• What is gratuity ?
• Should employee be denied gratuity by opting to extend retirement age to 60 years ?

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