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UMy HR just messaged me saying the salary for this month will be less since she’s deducting gratuity from my pay now onwards. Since I joined in September, she said she’ll deduct from September to now all at once, and then 1800 every month from now onwards. Is this possible?
I checked my offer letter and the CTC components and it has no mention of gratuity anywhere. When I asked her, she said that it was implemented after that. Strangely, our salary has been delayed for this month but when I asked other colleagues, they said they haven’t received a message like this. What is going on? How can my fixed in hand salary decrease like this? -
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PWhy would they deduct gratuity from salary?
That is not even allowed legally I reckon. A simple google search tell you that it’s now allowed. What’s the point of gratuity if I myself have to pay for it. As it is an employee qualifies for it post completion of 5 years of service and the employer has to pay in case of retirement or resignation only from the companies coffers. It’s always provided for in accounts.
Simply tell the HR that you won’t accept deductions as gratuity from your salary.
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PRESULTS FROM GEMINI on doing a google search.
No, gratuity cannot be deducted from an employee’s salary in India; it is a lump sum amount paid by the employer to the employee upon retirement or completion of a certain service period, and is not part of the regular monthly salary, as per the Payment of Gratuity Act, 1972.
Key points about gratuity in India:
Not deducted from salary:
Gratuity is not a deduction from your monthly salary, but rather a benefit paid out when you leave the company under eligible circumstances like retirement or resignation after completing at least five years of service.
Calculated separately:
The gratuity amount is calculated based on your basic salary and years of service, and is paid as a lump sum when you leave.
Legal requirement:
The Payment of Gratuity Act, 1972 governs the rules around gratuity payments in India
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UI knew that employers include gratuity in the CTC which is why I asked this question. However, now my take home pay is reducing!
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PYou can gently ask the HR to rethink about deduction and cite that Gratuity as per your info is exclusive of Salary as per law.
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