Gratuity Calculator
Covered Under Gratuity Act
For employees covered under the Payment of Gratuity Act (most organizations with 10+ employees)
₹
years
Not Covered Under Gratuity Act
For employees not covered under the Payment of Gratuity Act
₹
years
Formula
Gratuity = (Last Salary × 15 × Years of Service) / 26
Frequently Asked Questions
What is gratuity?
Gratuity is a lump sum payment made by an employer to an employee as a token of appreciation for services rendered. Under the Payment of Gratuity Act, 1972, it is mandatory for organizations with 10 or more employees.
How is gratuity calculated?
For employees covered under the Gratuity Act: Gratuity = (Last drawn salary × 15 × Years of service) / 26. Here, 15 represents 15 days' wages and 26 represents working days in a month. For non-covered employees, the denominator is 30.
What is the minimum service for gratuity?
An employee must complete a minimum of 5 years of continuous service to be eligible for gratuity. However, in case of death or disability, the 5-year condition is waived.
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