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CS Executive · Setting Up of Business, Industrial and Labour Laws · The Code on Social Security, 2020

Meera Foods Ltd, Pune, refused to pay a worker the gratuity to which he was entitled under the Code on Social Security, 2020. Which punishment is provided for this first offence?

Failure to pay gratuity due under the Code is punishable with imprisonment up to one year, or fine up to fifty thousand rupees, or both. It is treated more seriously than non-payment of compensation, which carries only a fine.

  1. AFine only, up to fifty thousand rupees
  2. BImprisonment up to one year or fine up to fifty thousand rupees, or bothCorrect
  3. CImprisonment up to six months or fine up to fifty thousand rupees, or both
  4. DImprisonment of at least one year and fine of one lakh rupees

Explanation

Failure to pay gratuity falls under clause (g) of the penalty section. It is punishable with imprisonment up to one year or fine up to fifty thousand rupees, or both. The six-month option applies to maternity benefit default, so it is wrong here.

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