Tuesday, October 26, 2010

Employers cannot withhold gratuity of retired employees: HC

Employers cannot withhold gratuity of retired employees: HC

Staff Reporter

MADURAI: Factories, mines, oilfields, plantations, ports, shops and other establishments with ten or more employees cannot withhold payment of gratuity to its retired employees by holding them responsible for financial loss, the Madras High Court has ruled.

Justice K. Chandru passed the ruling while dismissing two writ petitions filed in the Madurai Bench by the Chairman and Managing Director of Tamil Nadu Civil Supplies Corporation challenging orders passed by a Joint Commissioner of Labour to pay gratuity to two of its retired employees.

"Whatever may be the claim made by the petitioner management, it is not as if it has no machinery to recover the amount as there are other machineries either under service law or in civil law for recovering the amount. But on that score, the gratuity payable is not liable for attachment," he said.

The judge pointed out that Section 13 of the Act stated that gratuity payable under the legislation was not liable to attachment in execution of any decree or order of any civil, revenue or criminal court. "Even Section 14 of the Act provides overriding effect over other laws," he added.

Mr. Justice Chandru also said that Section 4 (6), the only provision which provides for forfeiture of gratuity amount to the extent of damage or loss caused to the employer, states that the money could be withheld only if the services of the employee had been terminated for wilful omission or negligence. Out of the two writ petitions before the court, one related to G. Packirisamy, a rice mill operator who was accused of short out turn of rice from the paddy given to him for hulling. He retired on July 31, 2001 but his gratuity was not paid.

The other case related to P. Dakshinamoorthy, a boiler operator who retired in 1995.

Courtesy_


1 comment:

  1. Whether employer has a right to withdhold full gratuity under the payment of Gratuity Act 1971 of a dismissed employee on account of misconduct? However, he has already been paid four installments of difference of pay due to him. No notice of withholding of gratuity is given by the employer. The employee had filed a case against his termination in the court. The case is pending at present and the employee has died.

    ReplyDelete

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