Baur and Co. Ltd. vs. Commissioner of Labour and Others – sllr 2012 volume 1 page 379

The case between BAUR AND CO. LTD. (the Petitioner) and the COMMISSIONER OF LABOUR AND OTHERS (the Respondents) addressed whether the Commissioner of Labour acted ultra vires in ordering the Petitioner to pay gratuity following an employee’s resignation, and whether forfeiture of gratuity was lawfully invoked under the Payment of Gratuity Act. It was held that an employer’s liability to pay gratuity arises upon termination of employment, including resignation, under section 5(1) of the Act. Forfeiture of gratuity pursuant to section 13 is permissible only in cases of termination on grounds of misconduct such as fraud or misappropriation, not in cases of resignation. Disputes regarding the correctness of forfeiture fall exclusively under the jurisdiction of the Labour Tribunal pursuant to s