New Delhi, Jan 14: In a significant ruling affecting teachers across India, the Supreme Court has held that they are not entitled to payment of gratuity at the end of their service as they cannot be classified as "employee" under the provisions of Payment of Gratuity Act, 1972. This ruling was given by a bench comprising Justice Shivaraj V Patil and Justice D M Dharmadhikari while upholding a full bench verdict of Gujarat High Court. It dismissed an appeal filed by Ahmedabad Private Primary Teachers Association challenging the high court order.
Under Section 2(E) of the 1972 act, "Employee means any person (other than an apprentice) employed on wages, in any establishment, factory, mine, oilfield, plantation, port, railway company or shop, to do any skilled, semi-skilled, or unskilled, manual, supervisory, technical or clerical work, whether or not such person is employed in a managerial or administrative capacity."
The government by a notification dated April 3, 1997, had extended the provision of the Gratuity Act, 1972 to educational institutions employing ten or more persons.
However, the apex court after going through the various definitions of employee came to the conclusion that "the teaching staff being not covered by the definition of 'employee' can get no advantage merely because by notification educational institutions as establishments are covered by the provisions of the act”. Bureau Report