Page 269 - DMGT516_LABOUR_LEGISLATIONS

Labour Legislations

Notes EPFO: Employees Provident Fund Organisation
Gratuity: It is a sort of an award which an employer pays out of his gratitude, to an employee for
his long and meritorious service, at the time of his retirement or termination.

Retirement: It is defined as the termination of the service of an employee other than on
superannuation.
Superannuation: It is the attainment of such age by the employee as is fixed in the contract or
conditions of service as the age on the attainment of which he has to leave the employment.
Wages: The compensation received by the worker for his services.

10.11 Self Assessment

State whether the following statements are true or false:
1. To qualify for the old-age insurance benefits, a person must have reached the retirements
age & be fully insured.

2. An employee ceases to be the member of the provident fund at the age of 60 years.
3. At present the rate of interest on provident fund is 12%.
4. Profit-earning capability of the firm is one of the guiding principles for framing the
gratuity scheme.
5. The gratuity of a person can be forfeited if his employment is terminated due to his bad
health.

Fill in the blanks:
6. When an employee attains a particular age as stated in the contract after which he is
entitled to leave the services is called…………………………..

7. After a period of …….. Years a person is usually eligible for the gratuity payment.
8. ………………….. is the award given by the corporates to their employees for the loyalty &
services rendered by them for a long period.

9. When an employee is terminated from the services on the account of his age & not on the
basis of the misconduct is ………………………………
10. ……………….. offers a fixed sum when an employee reaches a predetermined retirement
age.
11. …………% of the wage is the contribution of the employer towards the deposit linked
insurance fund.

10.12 Review Questions

1. "The principles which are incorporated in the Payment of the Gratuity Act is conducive to
the industrial harmony & is in consonance with public policy." Comment.
2. You are working in an organisation & every month your company deducts a part of PF
from your salary. It's been 3years that you are working with the same organisation. Now
you want to withdraw your PF. Examine the conditions you are required to meet before
withdrawing the PF.

264 LOVELY PROFESSIONAL UNIVERSITY