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Gratuity Ceiling on superannuation/retirement raised in India

Department of Public Enterprise(DPE) in its recent amendment to Gratuity Act raised the maximum ceiling from Rupees 3.5 L to 10 Lakhs payable to PSU employees on superannuation/retirement. This has somewhere given PSU jobs a competitive edge over private jobs. The terminal benefits has exponentially increased in PSU which adds to greater satisfaction in employees who always plans their after job life. If an employee has served continuously in a Navratna PSU for 30-35 Years becomes eligible for approximately Rs. 40-50 Laks(includes all terminal benefits) at the end of term and the amount may be released in a very short while(i.e. within 2-3 months). Moreover generally young generation has question about withdrawl of pension scheme in Government and PSU entities, On this very question I would like to add that PSU have their own pension plans for which they are deducting some amount every month from the salary and PSU itself contributes some amount in that. At the end of term, employee will get annuities in form of pension every month. The employee may also commute 1/3rd amount from the accumulated amount, if he/she desires so. Overall PSU's are paying better than Private jobs, everything is crystal clear, each and every component of salary is clearly defined, there are no hidden deductions and you will get major amount in hand out of gross pay.
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1 comment:

Gopalakrishnan said...

Many Public Sectors in India do not have Pension Scheme as a third retirement benefit.Only contributory PF and Gratuity exist and in view of this based on the recommendation of the Pay Revision Committee Report and 6th Pay Commission Report,it appears from a press release issued by DPE on 29/12/2010 that DPE has issued orders for increasing the gratuity limit to Rs 10lakhs and also to formulate and operate pension scheme within the overall limit of 30% of the pay and DA.
However,the detailed order issued is not available in DPE website as on date.
I request for making public this order issued on 20/12/2010.

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