Payment of Gratuity (Amendment) Bill, 2018 passed by Parliament

Mar 23, 2018 | by Avantis RegTech Legal Research Team

The Payment of Gratuity (Amendment) Bill, 2018 has been passed by parliament on March 22, 2018. The bill ensures harmony amongst employees in the private sector and Public Sector Undertakings/Autonomous Organizations under Government who are not covered under CCS (Pension) Rules. These employees will be entitled to receive higher amount of gratuity at par with their counterparts in Government sector. The bill was passed by the Rajya Sabha on March 22, 2018 and the Lok Sabha on 15th March, 2018.

Before implementation of 7th Central Pay Commission, the ceiling under CCS (Pension) Rules, 1972 was Rs. 10 Lakh. However, with implementation of 7th Central Pay Commission, in case of Government servants, the ceiling has been raised to Rs. 20 Lakhs. Therefore, considering the inflation and wage increase even in case of employees engaged in private sector, this Government decided that the entitlement of gratuity should also be revised in respect of employees who are covered under the Payment of Gratuity Act, 1972. Accordingly, the Government initiated the process for amendment to Payment of Gratuity Act, 1972 to increase the maximum limit of gratuity to such amount as may be notified by the Central Government from time to time.

In addition, the Bill also envisages amending the provisions relating to calculation of continuous service for the purpose of gratuity in case of female employees who are on maternity leave from 'twelve weeks' to such period as may be notified by the Central Government from time to time.

[Release ID: 1525869]

URL: http://www.pib.nic.in/PressReleseDetail.aspx?PRID=1525869


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