P&H:Upholds Gratuity for Contract Employee After Long Service, Says Contractual Label Cannot Defeat Statutory Right

punjab-haryana
⚖️ Order Date: 09 Sep 2026
Headnotes

(i) Payment of Gratuity Act, 1972, Ss.4, 2A — Gratuity — Merely because initial appointment was contractual, would not by itself be sufficient to deny him the statutory benefits of gratuity. (Para 18)

(ii) Payment of Gratuity Act, 1972, Ss.4, 2A — Gratuity — Entitlement to gratuity cannot be denied merely because the initial appointment was contractual for 89 days when employee has rendered concerned department from time to time for about 21 years — Nature of initial...

(iii) Payment of Gratuity Act, 1972, S.2A — Gratuity — Continuous service — Service record, attendance record, salary record, joining and relieving orders and other relevant documents can establish continuous service notwithstanding certain notional breaks. (Para 16)

(iv) Payment of Gratuity Act, 1972, S.4 —Gratuity —Regularization — Question of regularization does not arise while deciding entitlement to gratuity — Issue is confined to statutory gratuity and not whether employee becomes a regular employee by long service. (Para 19)


Facts of the Case

P&H:Upholds Gratuity for Contract Employee After Long Service, Says Contractual Label Cannot Defeat Statutory Right

The Punjab and Haryana High Court has dismissed two appeals filed by the Director School Education, U.T. Chandigarh, and upheld gratuity awards granted to two contract teachers who had served the department for many years.

The cases involved Smt. Ashok Lata and Sh. Balvinder Singh, both of whom were initially appointed on contractual terms. The department argued that since their appointments were not regular and one of the appointment orders specifically excluded gratuity and other service benefits, they could not claim gratuity later.

The Court, however, focused on the actual length and nature of service rendered. It noted that Ashok...

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