Gratuity, maternity benefit and the medical bonus, crèches, and social security for gig and platform workers.
Written from the official text · not reviewed by a lawyer · follows the Central Rules
Key points
Gratuity is payable when employment ends after continuous service of not less than five years s. 53(1); the five years are not needed when employment ends on death or disablement or when fixed-term employment expires s. 53(1), second proviso.
It is fifteen days’ wages for every completed year of service, or part of a year over six months, at the rate of wages last drawn s. 53(2). For a monthly-rated employee, fifteen days’ wages are the monthly wage divided by twenty-six and multiplied by fifteen s. 53, Explanation 3.
The employer must pay gratuity within thirty days from the date it becomes payable s. 56(3).
A woman who has actually worked for the employer for not less than eighty days in the twelve months before her expected delivery is entitled to maternity benefit s. 60(2), for up to twenty-six weeks, of which not more than eight weeks come before the expected delivery s. 60(3).
With two or more surviving children the maximum is twelve weeks s. 60(3), proviso.
A woman who legally adopts a child below the age of three months, or a commissioning mother, is entitled to twelve weeks from the date the child is handed over s. 60(4).
If the employer does not provide pre-natal confinement and post-natal care free of charge, she also gets a medical bonus of three thousand five hundred rupees, or the amount the Central Government notifies s. 64.
An establishment under the maternity benefit Chapter in which fifty employees, or the number the Central Government prescribes, are employed must have a crèche s. 67(1).
A gig worker earns from work outside a traditional employer-employee relationship s. 2(35). Aggregators contribute to schemes for gig and platform workers at a rate the Central Government notifies of not more than two per cent of annual turnover, and never more than five per cent of what they pay those workers s. 114(4).
If you are an employer
Work gratuity out on the wages last drawn and pay it within thirty days of its falling due s. 53(2)s. 56(3).
If you are a worker
Fixed-term employees do not need five years of service for gratuity; it is paid pro rata s. 53.
Try it
An employee whose wages last drawn were ₹52,000 a month resigns after 7 years and 8 months of continuous service.
Answer: Yes: five years of continuous service are not needed when employment ends on death
Five years of continuous service are not needed where employment ends on death or disablement or on the expiry of fixed-term employment s. 53(1), second proviso.
Provided further that the completion of continuous service of five years shall not be necessary where the termination of the employment of any employee is due to death or disablement or expiration of fixed term employment
Gratuity is paid at the rate of fifteen days’ wages for every completed year of service s. 53(2).
For every completed year of service or part thereof in excess of six months, the employer shall pay gratuity to an employee at the rate of fifteen days' wages
A day’s wage is the monthly wage divided by twenty-six, ₹2,000, so fifteen days’ wages are ₹30,000 a year. The 8 months are more than six, so 8 years are counted: ₹2,40,000 s. 53.
the fifteen days' wages shall be calculated by dividing the monthly rate of wages last drawn by him by twenty-six and multiplying the quotient by fifteen
The maximum period is twenty-six weeks, of which not more than eight weeks may come before the expected delivery s. 60(3).
The maximum period for which any woman shall be entitled to maternity benefit shall be twenty-six weeks of which not more than eight weeks shall precede the expected date of her delivery
Answer: A person who works and earns outside a traditional employer-employee relationship
A gig worker performs work or takes part in a work arrangement and earns from it outside a traditional employer-employee relationship s. 2(35).
"gig worker" means a person who performs work or participates in a work arrangement and earns from such activities outside of traditional employer-employee relationship
The contribution by an aggregator may not exceed five per cent of the amount it pays or owes gig workers and platform workers s. 114(4), proviso.
Provided that the contribution by an aggregator shall not exceed five per cent. of the amount paid or payable by an aggregator to gig workers and platform workers.
Gratuity— Who gets gratuity, how much, and when it must be paid under the Code on Social Security, 2020.
Maternity benefit— Paid maternity leave, the medical bonus, nursing breaks, crèches and protection from dismissal under the Code on Social Security, 2020.
Official text reproduced from the Gazette of India, India Code and State Government sources. This is not legal advice; check the source PDF before relying on any provision.