Gratuity Amount Calculation

Employees, as defined here, are the ones hired on company payrolls. Trainees are not eligible and gratuity is paid on the basis of the employee’s basic plus dearness allowance if any.

How much can you get?

You become entitled to a gratuity on resignation or on retirement after five years or more of service. As per the Act, the gratuity amount is 15 days’ wages multiplied by the number of years put in by you. Here wage means your basic plus dearness allowance. Take the monthly salary drawn by you last (basic plus dearness allowance) on resignation or retirement and divide it by 26, assuming there are four Sundays in a month. This is your daily salary. Multiply this amount by 15 days and further with the number of years you have put into service.

For instance, if your average monthly salary is Rs 50,000, the gratuity payable to you after 10 years of service would be Rs 290,000. However your employer factors in another term: ‘uninterrupted service’. The term covers the service period of the employee including leaves or breaks, except periods notified as breaks in service by the employer.

For employees who do not fall under the Gratuity Act, the amount due for them is half of the average ten months’ salary multiplied by the number of years of service.

How to calculate Gratuity ?

Gratuity = (Last drawn salary + Dearness Allowance / 26) x 15 x Number of years of service

 

Source : Rediff

11 COMMENTS

  1. Sir I was central reserve police force and resignation FM service on 18/12/2017 after 11 year regular service. I am eligible for gratuity

  2. Gm.Sir, for doctor in calculation of a gratuity in da amt non practicing allowance will be calculated or not as we calculate da on basic pay and and grade pay plus npa the on that amt we calculate da.so when we pay gratuity basic plus grade pay plus npa then on this total we calculate da then multiplied by no of yrs. we r taking 30 days in a month . kya hamen 26 din lene chahiyen. I M in INDIAN RED CROSS SOCIETY.. ALl govt scales are applied.

  3. Reg 6th pay commission;While pay and other benefits increased
    from 01/01/06 asper GO issued on 29th
    Aug08 gratuity comes effect from may2010
    Now as per 7th pay commission pay revised
    w e f Aug2016 when will gratuity revision
    implemented

  4. i am working as a teacher in municipal corporation of delhi
    my basic & da is rs.45201 .my service is 30.7 years
    what amount of gratuity

  5. sir i request to my 20 year service compled and my basic including grade pay 13010 sir muhe kitna amount mil sakta hai

  6. sir, I was central govt . employee , joined CRPF in oct 2004 in tendered my resignation due to my personal family problem in Apr 2012 whic was accepted on dated 03 apr2012 ,am I eligeble for service gratuity or not.

  7. Dear sir
    Thank for this useful post.My question is for employees having five day week,is the dividing factor will be 22 instead of 26.

  8. IS central govt. employee, who joined after 2004 and comes under new pension scheme, eligible for gratuity after retirement.

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