'Manager' Of Factory U/S 2(f) Of Payment Of Gratuity Act Can Be Considered As Employer For Gratuity Proceedings: Kerala High Court

The Kerala High Court held that a manager of a factory, as defined under Section 2(f) of the Payment of Gratuity Act, 1972, can be considered the lawful employer for the purpose of gratuity proceedings, even in the absence or death of the proprietary owner.Justice K Babu delivered the judgement, dismissing a challenge brought by the legal heirs of late Jose Samuel, former proprietor of Thankam Cashew Factory. The petitioners contended that a gratuity award passed on October 4, 2023, was void ab initio since it was rendered against a deceased person. The petitioners — Thankamma (widow of Jose Samuel) and their three sons — contended that the order was passed against a deceased individual, since Jose Samuel had died on February 22, 2022, and thus, the order was a nullity. They sought to set aside the ex parte order and filed an appeal along with an application for condonation of a 472-day delay.The question before the Court was whether the notice to the factory's manager satisfies the requirement of notice to the “employer” under the Gratuity Act, especially when the proprietary owner is deceased and whether the appellate authority under the Gratuity Act has jurisdiction to admit an appeal beyond the statutory limit of 120 days. The Court relied on the statutory definition of “employer” under Section 2 (f) (iii) of the Gratuity Act, which includes “ any person entrusted with ultimate control over the affairs of the establishment,” including a manager or managing director. The Court noted that the factory's manager received notice of the gratuity proceedings and the petitioner, the widow of Jose Samuel, had since assumed control of the factory's licence. Thus, the Court concluded that the employer was properly represented “ Once the manager - the person in control of the affairs of the factory - is served with notice, the death of the owner has no consequence. There is no need to implement legal representatives separately.” The Court addressed the limitation period for filing appeal under Section 7(7) of the Gratuity Act. The petitioners had filed an appeal 472 days after the original award, along with a delayed condonation application. Justice Babu held that the Appellate Authority had no power to condone delays beyond the statutorily prescribed maximum of 120 days. Citing precedents including , Commanding Officer, Naval Base v Appellate Authority [2004 KHC 1073], and Sree Avittom Thirunal Hospital v State of Kerala [2023 KHC 9015], the Court emphasized that the Gratuity Act is self-contained code, and the application of Section 5 of the Limitation Act is impliedly excluded. The High Court dismissed the writ petition, upheld the gratuity award of ₹44,438 plus interest, and directed that the amount deposited by the petitioners during the appeal be released to the retired worker. Case Title - Thankamma and Ors v Regional Joint Labour CommissionerCitation - 2025 LiveLaw (Ker) 479Case No - WP(C) 24720/ 2025Counsel for Petitioner - H VishnudasCounsel for Respondent - V K Sunil (Sr. GP), K M FirozClick Here To Read/Download Judgment

'Manager' Of Factory U/S 2(f) Of Payment Of Gratuity Act Can Be Considered As Employer For Gratuity Proceedings: Kerala High Court

Anamika MJ

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