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Calculation Of Gratuity - Basic Salary

navinjoshi9 Started The Discussion:

Dear All,I have a little confusion about calculation of gratuity as simply we calculate the same as :(((Basic +DA)/26)*15)*no. of working years but how we calculate when an employee gets an increament every year and the basic salary changed every year.can we calculate gratuity every year.please advise.thanks,ncj

R.N.Khola - Contributing Member
Dear Member,

This is to be calculated on last drawn rate of Basic & DA/VDA if any. We are not required to calculate gratuity every year. For more details go through section 4 of the Payment of Gratuity Act, 1972.

With Regards,
R.N.Khola
Sr. Associate (LL & IR)
Skylark Associates, Gurgaon (Haryana)
(Labour Law Consultants)
(M) 09810405361
Quote:
Originally Posted by navinjoshi9 View Post
Dear All,I have a little confusion about calculation of gratuity as simply we calculate the same as :(((Basic +DA)/26)*15)*no. of working years but how we calculate when an employee gets an increament every year and the basic salary changed every year.can we calculate gratuity every year.please advise.thanks,ncj

GiriKL - Contributing Member
Hello, The last drawn Basic salary will be taken into consideration for gratuity calculation.

thanks for advise but how can we manage gratuity account of each employee annual basis and how we make provision on our B/s.

sai prasad.r - Contributing Member
Dear Navin, We will consider only the last drawn salary even though basic salary changed every year of a employee. (last drawn salary(basic+DA)*total years of service*15)/26 Regards, Sai Prasad.

pawang4u - 
What about if a person works within group companies for 5 years i.e. Mr. A joins an organization X (India- Madras) on 1st april-2000 An Indian comany. He was deputed in organisation Y from 1st April 2004 in USA- los angeles. He was again deputed to organisation Z in 2006 (India- Ahemdabad). All the above mentioned oganisations are seprate entity but under one group company (Indian MNC) Parent company called XYZ. whether he is eligible for any gratuity?

DEEPAKJAIN1307 - Contributing Member
Dear Pawan,
Yes, He is entitled for the Gratuity.
As he has not resigned from any unit & perhaps use a transfer letter for moving from one unit to another.
His years of service within the group will get accumulated & made him entitled to claim gratuity.

Thanks & Regards
Deepak Jain

hello sir, This is venkateswarlu we are presently Gratuity per month Basic+Da * 4.81% this calculation correct (or) not please confirm my dough. my e-mail. venkateswarlu_singadla@yahoo.com

R.N.Khola - Contributing Member
Dear Member,

If you have taken any insurance policy under the P G Act, 1972 then contact your insurance branch office for having knowledge on payment of premium for your employees.

R.N.Khola
Skylark Associates, Gurgaon (Haryana)
(Labour Law Consultants)
(M) 09810405361
Quote:
Originally Posted by prakash9987 View Post
How to calculate gratuity premium for each employee.

dear all please ask me, my gross salary Rs. 25000/-. please suggest how many % of BASIC, HRA, CONVEYANCE & ANY OTHER ALLOWANCES TO BE BIFFUERCATE.

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