Recent Amendments to Payment of Gratuity Act, 1972
Following up on our post last week about the Recent amendments in the ESI Act, this week we give a snapshot of the latest amendments in the Payment of Gratuity act 1972.
For a more detailed and simplified post on the Payment of Gratuity Act, click here
Key amendments of Payment of Gratuity Act 1972
|S.NO||Section||Pre-amended position||Post – amended position|
|1||4(3)||The maximum amount of gratuity payable is Rs.3,50,000/||Now the maximum amount of gratuity payable is Rs.10,00,000/-|
|2||Sec.2(e)||The definition of employee covers only those performing manual, semiskilled skilled, unskilled, supervisory technical or clerical or managerial or administrative work. Thus a person who is not performing any of the above said categories of work like a teacher is not covered as an employee.||After the amendment, the definition has been broad based as to include any person, employed to do any kind of work. Thus the definition includes a teacher as an employee under the Act.|
Note : For establishments in the state of Maharashtra :
1) Rule 9 of Maharashtra Gratuity Rules has been amended where by the gratuity payable to an employee/nominee/legal heir, can be paid by demand Draft or account payee cheque.