Gratuity nomination at workplace: Who you can nominate and how to do it

Employees may nominate one or more individuals, usually family members, according to the law

If you are a salaried person, nominating a family member for your gratuity benefit will help them financially if you die.

 

What is a gratuity nomination?

 

A gratuity nomination is the process by which an employee designates who will receive their gratuity amount on their death. The nomination is made using Form F, which is submitted to the employer. Employees may nominate one or more individuals, usually family members, to ensure that their gratuity is distributed according to their wishes.

 

This process is essential as it helps ensure that gratuity benefits are provided to the designated beneficiaries without delays or legal complications.

 

Who can be nominated?

 

Under the Payment of Gratuity Act, 1972, nominations are primarily restricted to family members. This includes:

 

Wife

 

Children (both married and unmarried)

 

Dependent parents

 

Dependent parents of the spouse

 

Widow and children of a deceased son

 

You have the option to nominate multiple family members and assign specific percentages of the gratuity to each. This approach ensures that financial support is provided to several dependents.

 

What happens if there is no gratuity nomination?

 

Without a valid nomination, gratuity is generally paid to the employee's legal heirs. However, this can result in delays and potential legal disputes, as heirs may need to present legal documentation to confirm their entitlement. Therefore, it is recommended to make a nomination to facilitate a smoother and faster gratuity disbursement.

 

How to submit your gratuity nomination

 

Fill out Form F: This is the required form to nominate a beneficiary for your gratuity. Form F is specified under the Payment of Gratuity Act, 1972, and is typically available through your HR department.

 

Provide required details: The form will request the following information:

 

Employee's name and address

 

Nominee's name and address

 

Relationship to the nominee

 

Gratuity share: Specify how much of the gratuity each nominee will receive.

 

Signatures: You will need your signature along with that of a witness.

 

Once completed, submit Form F to your HR department or the designated authority in your organisation. Some companies may offer digital submission options or online portals.