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Payment of Gratuity (Amendment) Bill, 2017
March 24 , 2018
2311 days
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- The Parliament has passed Payment of Gratuity (Amendment) Bill, 2017 to empower government to fix period of maternity leave and tax-free gratuity amount with an executive order.
- The Bill seeks to amend Payment of Gratuity Act, 1972 on two issues related to maternity leave and ceiling of gratuity payable to an employee.
- Gratuity is calculated based on 15 days of wages for each year of continuous and complete service, subject to a ceiling.
- The Bill allows the government to fix the period of maternity leave for female employees as deemed to be in continuous service in place of the existing 12 weeks.
- The legislation will enable the government to enhance the ceiling of tax-free gratuity to Rs. 20 lakhs from the existing Rs. 10 lakhs for employees falling under the Payment of Gratuity Act.
- The amendment to the payment of gratuity law comes in the backdrop of Maternity Benefit (Amendment) Act, 2017 enhancing the maximum maternity leave period to 26 weeks.
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