Monday, November 16, 2009

What are the advantages of gratuity over pension? Should the two be paid jointly or separately & why?

There is a demand by a company to transfer their workers gratuity to the pension account of which I do not support. What is your own opinion?

What are the advantages of gratuity over pension? Should the two be paid jointly or separately %26amp; why?
Gratuity is different than pension.





Gratuity is paid by the employer based on the completed working years subject to general rules and regulation of the country and or depends on the Agreement the employer and employee has it.





Pension is a contribution by both the employer and employee on the monthly salary this takes care of post retirement income for the employee. This normally be deposited in Pension funds managed by Governmnet and by some financial Institutions in some countries.





Now if the transfer of gratuity to pension funds, depends if the interest is for the employee or not, there should be amutual agreement to this certainly.


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