Notional increment for employees retiring on 30 June
Many State employees draw their annual increment on 1 July. An employee who retires on 30 June completes a full year of service but retires one day before the increment falls due. For years, departments refused the increment on the ground that the employee was not in service on 1 July.
The Supreme Court's view
In Director (Admn. and HR) KPTCL v. C.P. Mundinamani (Civil Appeal No. 2471 of 2023, decided on 11.04.2023), the Supreme Court held that an increment is earned for the service rendered in the preceding year. An employee who has completed the year with good conduct is entitled to the increment, even though he retires on 30 June, and it must be counted for pensionary benefits.
How it is applied
Following this judgment, High Courts, including the High Court of Madhya Pradesh, have directed the grant of a notional increment from 1 July and revision of pension and the PPO. Later orders of the Supreme Court have dealt with the extent to which arrears are payable and to whom, so the relief available in a particular case, especially for employees who retired many years ago, should be checked against the current position.
What to keep ready
- the date of retirement and the date of the last increment;
- the PPO and pension calculation sheet;
- any representation made and the reply, if any.
Where a representation has been rejected, or not decided, a writ petition is the usual remedy.
This article is general information on the law as it stood when written. It is not legal advice. Every service matter turns on its own service record, rules and orders, which should be examined before any step is taken.