New Gratuity Rules for Private Sector Employees

A new labor law, which is set to come into force in the UAE from February 2, 2022, will ensure that public and private sector labor practices and services are broadly aligned, a senior official said. If the period of service exceeds five years, employees are entitled to the bonus of 30 days of basic pay for each year of work after the first five years, in addition to the 21 days of basic salary for each year during the first five years. Federal government and private sector workers will receive the same end-of-service benefits under new general rules announced Monday by the Ministry of Human Resources and Emiratization. Tipping is the additional financial compensation that the employer pays to the employee in exchange for the long-term employment services offered by the employee. Employees who have been with the company for five years or more receive tips. Tipping and its rules and regulations are governed by the Payment of Gratuities Act 1972. « The new rule is the first of its kind as it unifies the general labour rules in the country on the basis of a fixed-term contract, » the minister said. The law stipulates that all full-time employees working in the public and private sectors are granted annual leave of up to 30 days. By law, no tips are paid for employees who do not finish a year. In addition to salary, pension and pension fund, employees who have been working for the same company for a long time are also financed by tips. Tipping is the reward that an employee of the company receives.

If the employee meets certain working conditions, the tip will be paid according to a prescribed form in a guaranteed manner. A small portion of the tip is deducted from the employee`s salary, but most of it is paid by the company. Here, only 26 days a month are counted, because it is assumed that 4 days are holidays. At the same time, the tip is calculated on the basis of 15 days a year. According to this formula, an employee who works more than 6 months is calculated as a year. For example, if an employee works for 7 years and 8 months, he is considered 8 years and on this basis the amount of the gratuity is made. At the same time, if 7 years work for 3 months, it is considered only 7 years. However, a government employee is entitled to tax-free tips. On the other hand, for employers covered by the law on the payment of tips, only the last 15-day salary claimed is exempt from employee income tax. No minimum duration for term employees – In this context, the payment of tips for temporary employees is provided. And there will be no conditions for a minimum period of service. For the first time, a fixed-term worker who works for a certain period of time is granted the right to social security as a regular worker.

Fixed term refers to the employees who work on the contract. The tip is calculated on the basis of the basic salary and the DA. 2 The main factors used to determine the tip are the last salary used and the total number of years of service. Here you can calculate your tip via this calculator – www.goodreturns.in/gratuity-calculator.html Those who hold a job for up to five years are entitled to tips based on 21 pay days for each year of work. If an employee has served for an extended period of time, the tip increases to 30 days` pay for each year of work after the first five years. You can calculate the tip using the following formula: According to the Tips Act of 1972, an employee receives 15 days` salary as a tip in each year of his or her service. In this law, employees are the ones the company puts on the payroll, interns do not receive tips. It is not necessary to pay tax on the amount received up to 20 lakhs as part of the tip, and this law applies in establishments where the number of employees is at least 10.

7th Wages Commission Latest news today: The salary, pension fund and tips of central government employees will be affected if the central government implements the new 2021 Payroll Code or the new Labour Code from 1 April 2021. Once the new Wage Code Bill is introduced in 2021, the changes that central government employees will experience will include changes in official working hours, the Tipping and Pension Fund (FP) and take-away wages. With many central government employees waiting for the announcement of an increase in the cost allowance (DA), when the new draft law on the wage code comes into force in 2021, employees will have a mixed experience as there will be both advantages and disadvantages. According to reports, the contribution to the pension fund will increase, while the own salary will decrease. Read also – Contingency funds: How employees can transfer FP credits from one company to another | Follow the step-by-step instructions here For a calculation of the tip amount for the calculation of 5 years, 1 year is determined as 240 working days. On the other hand, for workers involved in mining and related fields, one year is designated as 190 days. « An organization with 10 employees in a single day in the previous 12 months is required to pay tips. » Even if the number of employees falls below 10, the law still requires the organization to pay the tip. Factories, mines, businesses, ports, plantations, mines and all these companies are forced to pay tips.

The Ministry of Labour and Employment has finalised the rules for the four labour codes. The new labour law is to be implemented from 1 April 2021. Tell them that the old rule will continue for others. Currently, the tip is determined on the basis of a salary of 15 days per year after the end of the five-year work. The tip is given to employees on behalf of the company. Its maximum limit is 20 lakh rupees. The employee worked in the same company for 20 years and his last salary is 60,000 rupees. This salary is divided by 26, as 26 days are taken into account for tips.

This will result in an amount of Rs 2,307. Example – Mr. X has been working for PNR Firm for 10 years and his last salary received (Basic + Dearness Allowance) is Rs 30,000. Therefore, the amount of Mr. X`s tip would be – 10 x 30,000 x 15/26 = Rs. 1,73,076 (tip depends on the total number of years spent with the company and the last salary received) As of February 2, 2022, full-time employees in the private sector and the federal government will be entitled to a tip of 21 days of base salary for each year of the first five years of employment. Under the new 2021 Wage Code Bill, workers have no rights to tips, even if they have only been employed for one year. .