What is the difference between gratuity and compensation?
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In the private sector, gratuity is not regulated. Compensation arises only in certain circumstances, such as when a contract of employment ends for a reason not attributable to the worker or when a worker resigns or retires after 5 years of service.
In the public sector gratuity is a payment in recognition of past years of continuous service. Payment of gratuity for past years of continuous service applies to all employees who were in the service from 1st January 1979 except for those whose gratuity payment is specified in their Scheme of Service. Gratuity for continuous service shall be paid every five years under delegated authority.
Compensation is the total amount of monetary or non-monetary pay provided to an employee by an employer in return for work performed as required. Payment of compensation for past period of service from 1st January 1979 or thereafter is an accrued benefit, applies to employees in continuous employment in the public sector.
Employees who are transferred between the public service will not affect eligibility for the payment of compensation.
Source: Government of Seychelles