There are ten persons employed in a shop and the payment of gratuity act 1972 becomes applicable the...........

Industrial Relation and labour law Labour Laws -II

There are ten persons employed in a shop and the payment of gratuity act, 1972 becomes applicable there. After the application of the act, three employees have left the shop. In such a situation which of the following will be applicable?

this act will continue to be applicable there.

as soon as the number of employees go below ten, the act will cease to apply.

the act is silent about this type of situation.

none of the above

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Explanation:

this act will continue to be applicable there.

There is an exception where the condition of working continuously for five years with an organisation is not applicable. If an employee's services are terminated due to his death or has become disabled due to an accident or a disease, an employer is mandated by law to pay gratuity to him or his nominee/legal heir, as the case maybe, irrespective of the number of years of continuous service.