Subhash G C
Can a Subsistence Allowance paid to an employee be deducted from Gratuity payable?
From India , Mumbai
Agm(hr),torrent Power Ltd,ahmedabad
+4 Others

Hi, First of all, please clarify as to why subsistence allowance should be deducted? Cyril
From India , Nagpur

Hi, I have not received a reply to my query. In my view, subsitance allownace should not be linked to gratuity payment. This allowance is paid when a person is suspended pending an enquiry. If the charges are not established then the person is considered as "present on duty" and should be paid as if, he was present on work.
Please clarify wgat you want to know.

From India , Nagpur
Gratuity can not be deducted from subsitence allowance.
It is part of domestic inquiry when employee is suspended.
After inquiry if you decide any punitive action in that case no arrears of salary is required to pay.
But after inquiry if the employee is not guilty in that case entire amount of salary is required to be paid minus subsistance allowance paid.
pl refer your standing orders what is the provision for subsistence allowance.
my advise not to dedeuct subsistence allowance from gratuity it is violation of Gratuity acr.
if any querry pl feel free to ask
himanshu pathak

From India , Ahmadabad
RE: Deduction fro Gratuity
There is no provision in the Act to make any adjustment or deduction in the quantum of payment of gratuity.
U/s 4(6) of the Act, there is however a provision for forefeiture under certain conditions.
As regards susbsitence allowance, it is the component of salary / wages payabled/ paid to an emplyee pending disciplinary proceedings or during disciplinary proceedings depending upon the Standing Orders of the Organiation and hence there is no question of deducting 'subsitence allowance' paid in lieu of 'wages' from the statutory payment of gratuity.
As a matter of clarification, the period under which an emplyees has received 'subsitence allowance' would be reckoned as 'uninterrupted service' under Section 2A of the Act for counting min. period of 'five years of continuous service' for deciding the entitlement to payment of gratuity.
High Court, Madras
99406 86632

From India , Madras

Subsistence allowance is to provide the employee a livelihood during the period of suspension.This subsistence allowance can be deducted while the period of suspension is regularised as leave or otherwise. If the employee is terminated, the subsistence allowance cannot be deducted.
From India , Madras

Subsistence Allowance is an amount paid to the suspended employee during the period of suspension instead of paying the entire salary during the period of suspension whereas Gratuity is a terminal benefit payable after completion of 5 yrs when the employee leaves the organization and gratuity can only be forfeited for the reasons mentioned in the Gratuity Act. Both are totally different concepts and not to be confused.
From India , Madras
Hi Seniors,
I am working in private company from last 6.5 years . I will complete my age 58 years after two months, company is not giving Gratuity to any body. company told to one employee who has left the service after 10 years.He asked for Gratuity, but reply was.... we have paid salary we have not deducted Gratuity from your salary. It means we have paid Gratuity
now there is no question of Gratuity.Employer has not shown in CTC clculation as Gratuity deduction. Please tell me at the time of my retirement employer can say as above is it correct.
If employer said as above what type of decision I have to take? Please guide me for further action.

From India,

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