Regularized daily wage employee's entire continuous service, including pre-regularization period, qualifies for gratuity computation under Payment of Gratuity Act on last drawn wages; no distinction between service types permissible.

JUDGMENT :

Jyotsna Rewal Dua, J.

The petitioner/State feels aggrieved against the order dated 17.05.2023 passed by the Controlling Authority (Labour Officer), Bilaspur Zone, Bilaspur, H.P., directing the petitioner (respondent therein) to pay gratuity to the respondent (applicant therein). Petitioner’s grievance is also against the further order passed by the Deputy Labour Commissioner-cum-Appellate Authority, dismissing petitioner’s appeal against the aforesaid order and directing the petitioner to pay the balance amount of Rs.2,77,614/- along with accrued interest in favour of the respondent towards his gratuity.

2. Heard learned Additional Advocate General and considered the case file.

3. It is not in dispute that the respondent was appointed as a daily wage Class-IV employee on 27.01.1997. He joined his duties as such on 27.01.1997. His services were regularized on 16.08.2007. The respondent retired as a Class-IV employee on 30.04.2020 after attaining the age of superannuation. Since he was not paid gratuity, he approached the Controlling Authority under the Payment of Gratuity Act, 1972. The Controlling Authority, vide order dated 17.05.2023, took cognizance of the fact that the respondent had continuously worked for 18 years with the petitioner/employer, the said period included daily wage service rendered by him for about 10 years. The respondent was held entitled to gratuity, which was computed on the basis of the wages last drawn by him at the time of superannuation. The payable gratuity was worked out at Rs.3,88,550/-. The petitioner/employer had already paid an amount of Rs.1,51,800/- towards gratuity to the respondent. However, for the service rendered by the respondent on daily wage basis, gratuity was not paid. Applicable interest was also not paid.
The petitioner assailed the order dated 17.05.2023 before the Appellate Authority. The ground urged before the Appellate Authority, which is also reiterated in the present writ petition, essentially pertains to the gratuity payable to the respondent vis-à-vis the service rendered by him on daily wage basis. According to the employer/petitioner, the respondent served on daily wage basis from the year 1997 up to 21.08.2007, therefore, gratuity for the said period was to be computed under the Payment of Gratuity Act, and for the remaining period, gratuity was to be calculated in accordance with the Central Civil Services (CCS) (Pension) Rules, 1972. The Appellate Authority dismissed the appeal on 29.08.2025 as under: -

“In view of the facts and circumstances, after affording ample opportunities of being heard during the proceedings to both the parties to the appeal and in view of the reasons mentioned hereinabove, I am constrained to dismiss the appeal. The facts recorded hereinabove clearly envisages and establishes beyond doubt that there is no relevance to go into peripheral details of the appeal in view of the facts and contentions raised in the appeal whatsoever in view of the facts recorded hereinabove. The careful analysis and consideration of the foregoing facts and circumstances and relevant provisions has been done in totality and accordingly, as provided in Section-7(8) of the ibid Act, in view of the abovementioned conclusions and the present appeal is accordingly dismissed after considering all the relevant facts, circumstances and relevant provisions and orders of the Controlling Authority are upheld as per contents of the following para;
Last wages drawn= Rs. 29,282/-
Length of service 23 years.
Total last wages drawn x length of service x 15/26= Rs. 29,282/- (x)23(x)15/26-Rs. 3,88,550/- (Rs. Three Lakhs Eighty Eight Thousand Five Hundred Fifty Only). However, the Respondent/Claimant has already been paid a sum of Rs. 1,51,800/-on account NPS gratuity. Therefore Rs. 2,36,750/- (Rs. 3,88,550/- (-) Rs. 1,51,880/-) alongwith simple interest @ 9% per