Company refuses to pay gratuity

Company refuses to pay gratuity

QUESTION:

We want to terminate an employee as the management found him unfit for the company. The management does not want to pay him the gratuity or benefits. In what situations the employer can refuse to pay the benefits to the employee? On the other hand, what are the minimum benefits that an employer should pay to employee on termination? Please advise. - ON, Doha

ANSWER:

An employee is not entitled for any benefits if he or she is terminated under Article 61 of the Labour law. According Article 61, the employer has right to terminate the employment contract without any notice period or end-of-service benefits for reasons of gross misconduct such as false identity or nationality or submitted false certificates or documents, any act which causes gross financial loss to the employer, an assault on the person of the employer, disclosed confidential information, convicted for a crime involving immorality or dishonesty, drunk or under the influence of drugs during working hours or absent from work without legitimate cause for more than 7 consecutive days or 15 days in one year, etc.

Article 54 of the Labour Law stipulates that an employee who has completed a period of minimum one year of continuous service shall be entitled to gratuity on the termination of employment. The gratuity shall be calculated based on the basic wage on the date of entitlement. Accordingly, the basic salary on the date of termination will be the basis for calculation of the same. The employee will be entitled for gratuity minimum 3 weeks basic salary per year of service. The employee is also entitled for leave salary and repatriation expenses.