Kerala Service Rules - Part III (Compensation Pension)

Provisions for Compensation Pension

1. Options for Discharged Employee [Rule 33]

   • When a permanent post is abolished, the selected employee to be discharged has two options:

     1. Leave Service with Pension Benefits [Rule 33(a)]: The employee may opt to leave the service and accept pension benefits based on their qualifying service earned up to that point.

     2. Accept Alternative Government Employment [Rule 33(b)]: The employee may choose to accept another position in government service.

2. Definition of Compensation Pension

   • The pension granted based on the employee's chosen option is termed a compensation pension.

3. Ineligibility for Pension [Rules 36 and 37]

   • No pension is admissible for the loss of an appointment upon discharge after completing a specified term of service [Rule 36].

   • No pension may be awarded for the loss of a compensatory allowance or special pay [Rule 37].

4. Notice Period Requirements [Rule 40]

   • Reasonable notice must be provided to an employee in permanent employment before their services are terminated due to the abolition of their post.

   • If at least three months' notice is not given and no alternative employment is provided on the date of discharge, the employee may receive a gratuity, sanctioned by the Government, not exceeding their emoluments for the period by which the notice falls short of three months. This gratuity is in addition to any pension entitlement under Rules 64 to 70. However, the pension is not payable for the period covered by the gratuity in lieu of notice.

5. Gratuity Refund on Re-employment [Rule 41]

   • If an employee is permanently re-employed within three months from the date of notice, they must refund the compensation gratuity awarded under Rule 40. However, the employee is not required to refund the proportion of the gratuity corresponding to the period of non-employment relative to the total period for which the gratuity was given.

   • If the re-employment is temporary, no refund of the gratuity is required. However, if temporary employment is anticipated, the gratuity should be proportionately reduced.