Under the Code on Social Security, 2020, which of the

Solution

One of the landmark reforms of the Code on Social Security, 2020 is the extension of gratuity rights to fixed-term contract employees on a pro-rata basis, even if their contract period is less than the traditional 5-year threshold. Under the Code, gratuity is payable on: (i) superannuation, (ii) retirement or resignation, (iii) death or disablement, (iv) termination of a fixed-term employment contract, and (v) on the happening of any event notified by the Central Government. The 5-year continuous service rule which was the cornerstone of the Payment of Gratuity Act, 1972 does not apply to fixed-term employees, journalists, and certain other categories covered by the Code. This ensures that employers cannot exploit fixed-term contracts to deny workers their gratuity entitlements. However, it is worth noting that both the Industrial Relations Code, 2020 and the Social Security Code, 2020 contain overlapping provisions on gratuity for fixed-term workers, and clarity on exact computation for sub-one-year contracts remains a debated point