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In India, gratuity is a type of retirement benefit. It is a payment made with the intent of monetarily helping an employee after his or her retirement. It was held by the Supreme Court of India in Indian Hume Pipe Co Ltd v Its Workmen that the general principle underlying a gratuity scheme is that by service over a long period the employee is entitled to claim a certain amount as a retirement ...
The position is considered to be a powerful one as of Personnel, Public Grievances and Pensions is the cadre controlling authority of the Indian Administrative Service, [4] Central Secretariat Service and is the administering agency of the Central Bureau of Investigation (CBI) and the Public Enterprises Selection Board (PESB).
The Payment of Gratuity Act 1972 applies to establishments with 10 or more workers. Gratuity is payable to the employee if he or she resigns or retires. The Indian government mandates that this payment be at the rate of 15 days salary of the employee for each completed year of service subject to a maximum of ₹ 2000000. [24]
The employee can borrow up to 34 months of the basic pay to a maximum of Rs 25 lakh, or cost of the house/flat, or the amount according to repaying capacity, whichever is the least. If both spouses are central government employees, they can take Housing Building Advance (HBA) either jointly, or separately.
Under this scheme, employees working in the organised sector can gain pension benefit after reaching age 58. This EPS applies to new and existing members. The Scheme has been framed by the Central Government in accordance with the powers conferred by section 6A of the Employees’ Provident Funds and Miscellaneous Provisions (EPF and MP) Act, 1952.
The employees performance review is conducted under the Fundamental Rule (FR) 56 (J) and 56 (I), and also under Rule 48 (1) (b) of the Central Civil Services (Pension) Rules, 1972, that gives "absolute right" to the appropriate authority to retire a government servant, "if it is necessary to do so in public interest".
An employee joining the central or state services prior to 1 January 2004 would receive pension payments as lifetime income security from the time of retirement (at age 58, in most cases) until death. This was an entitlement for government employees for their services rendered during the tenure which often lasted more than three decades.
National Pension System is a defined contributory pensions introduced by Government of India. It is mandatory for all Central Government employees with effect from 1 January 2004. It extends to all citizens of India including workers of the unorganized sector on a voluntary basis with effect from 1 May 2009. [10]