Effective January 10, 2024, all establishments covered under the Payment of Gratuity Act in Karnataka must comply with the newly implemented Karnataka Compulsory Gratuity Insurance Rules, 2024 (Rules). These rules are seen to follow Andhra Pradesh’s similar policy established in 2011, requiring employers to obtain insurance coverage for their gratuity payment, as per the Payment of Gratuity Act, 1972. Karnataka becomes the third State to mandate Compulsory insurance under the Payment of Gratuity Act following Andhra Pradesh and Telangana.
Important Note: If the establishments have multi state presence, then they are governed by the Payment of Gratuity Central Rules where this notification won’t be binding. Only for the establishments having exclusive Karnataka State presence, the below changes are required to be considered.
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