Payment of gratuity act Flashcards
(50 cards)
The Payment of Gratuity Act, 1972 applies to establishments with at least: a) 5 employees b) 10 employees c) 15 employees d) 20 employees
b) 10 employees
Gratuity is payable to an employee who has completed a minimum of: a) 3 years of continuous service b) 5 years of continuous service c) 7 years of continuous service d) 10 years of continuous service
b) 5 years of continuous service
Gratuity is calculated based on: a) Basic salary only b) Basic salary + Dearness Allowance c) Gross salary d) Employer’s discretion
b) Basic salary + Dearness Allowance
The maximum amount of gratuity payable under the Act is: a) ₹10 lakh b) ₹20 lakh c) ₹30 lakh d) No limit
b) ₹20 lakh
Gratuity is paid upon: a) Retirement b) Resignation after 5 years c) Death or disablement (even before 5 years) d) All of the above
d) All of the above
The formula for calculating gratuity for employees under the Act is: a) (Last drawn salary × number of years of service) ÷ 26 b) (Last drawn salary × number of years of service) ÷ 30 c) (Last drawn salary × number of years of service × 15) ÷ 26 d) (Last drawn salary × number of years of service × 30) ÷ 26
c) (Last drawn salary × number of years of service × 15) ÷ 26
The employer must pay gratuity within how many days of it becoming due? a) 15 days b) 30 days c) 45 days d) 60 days
b) 30 days
If the employer fails to pay gratuity within the stipulated time, they must pay: a) Simple interest b) Compound interest c) No interest d) Penalty only
a) Simple interest
Under Section 4(6), an employee may be denied gratuity if: a) He/she resigns voluntarily b) He/she commits an offense involving moral turpitude c) He/she is dismissed for poor performance d) He/she takes early retirement
b) He/she commits an offense involving moral turpitude
Which of the following establishments are covered under the Act? a) Factories b) Shops and establishments with 10 or more employees c) Mines, oil fields, plantations d) All of the above
d) All of the above
Gratuity is a: a) Voluntary payment by the employer b) Statutory right of the employee c) Benefit only for government employees d) Loan given to employees
b) Statutory right of the employee
The Act is enforced by: a) Labour Inspectors b) Central Government c) Controlling Authority appointed by State Government d) Trade Unions
c) Controlling Authority appointed by State Government
Which section of the Act deals with the calculation of gratuity? a) Section 2 b) Section 4 c) Section 6 d) Section 9
b) Section 4
Can an employee nominate someone to receive gratuity in case of death? a) Yes, as per Section 6 b) No, it must go to legal heirs c) Only for government employees d) Only if the nominee is a family member
a) Yes, as per Section 6
If an employer disputes the gratuity payment, the employee can approach: a) High Court b) Controlling Authority under the Act c) Trade Union d) Labour Commissioner
b) Controlling Authority under the Act
The time limit for filing a gratuity claim is: a) 30 days b) 60 days c) 90 days d) No specific time limit
c) 90 days
Gratuity can be forfeited if the employee: a) Is dismissed for willful negligence b) Has completed less than 5 years of service c) Takes unpaid leave d) Resigns voluntarily
a) Is dismissed for willful negligence
If gratuity is not paid within the prescribed time, the employer is liable to pay: a) Double the amount as penalty b) Interest at the government-prescribed rate c) 10% penalty d) Nothing, if the employer has financial issues
b) Interest at the government-prescribed rate
The Act applies to government employees: a) Yes, but they are covered under separate rules b) No, government employees do not get gratuity c) Yes, without any separate rules d) Only if they work in PSUs
a) Yes, but they are covered under separate rules
Under Section 7, an employer must pay gratuity: a) In cash b) By cheque or electronic transfer c) Either (a) or (b) d) Only through the bank
c) Either (a) or (b)
Can an employer refuse to pay gratuity due to company losses? a) Yes, if the company is in financial distress b) No, gratuity is a statutory obligation c) Only with government approval d) Yes, if the company is closing down
b) No, gratuity is a statutory obligation
Gratuity is taxed if it exceeds: a) ₹10 lakh b) ₹20 lakh c) ₹30 lakh d) ₹50 lakh
b) ₹20 lakh
If an employee works part-time, is he/she entitled to gratuity? a) No, only full-time employees are eligible b) Yes, if he/she has completed 5 years of service c) Only if specified in the contract d) Yes, with employer’s permission
a) No, only full-time employees are eligible
The Act applies to private sector employees: a) Yes, if the company has 10 or more employees b) No, gratuity is only for government employees c) Only in large corporations d) Only if specified in the contract
a) Yes, if the company has 10 or more employees
