Delhi Cloth & General Mills Co. v Workmen (1969)

Labour Law II · Gratuity — Determination, Forfeiture, Compulsory Insurance and Competent Authority

Facts.

Workers claimed gratuity as a matter of right under a scheme; the employer treated it as a discretionary bounty.

Issue.

Is gratuity a bounty the employer may withhold, or a benefit earned by service?

Held.

Gratuity is a retiral benefit earned by long and continuous service, payable as of right under the scheme/statute, not a gift.

Why it matters.

It fixes the nature of gratuity — the opening line of any gratuity essay and the reason it cannot simply be refused.

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