Labour Laws & Ir
Gratuity Fund Formation Consultant
Assistant Engineer, Indian Telephone Industries,
V. Balaji
Ir & Hr
+2 Others

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Dear Sir,
Can you please let me know the rules of Gratuity & the sections pertaining to gratuity.
In my case I joined the organisation on Feb 2006. In another 3 months i'll be completing my 5 yrs of service. Since i've got a offer and i need to leave the organisation hence guide me whether Gratuity is applicable.
Awaiting reply.

From India, Bangalore
Dear Friend,
If you complete 5 years of service you will be entitled for Gratuity payment. Hence before taking any step think once aganin. Anyhow you have decided to leave the company, my advice is wait unitl eligible for gratuity.
This is only advice decision is yours.
I wish you all the best.

From India, Hyderabad
Dear Sapna,

In addition to my friend Telikepalli's reply, I shall give the details on calculation of Gratuity.

For gratuity calculation, the formula is Number of years of service x last drawn salary x15 /26.

1. Number of years of service : If the service comprises of completed years and a fraction of year, the fraction has to be rounded to full year. i.e. If the fraction is 6 months or below, it will be rounded down. And if it is above six months, it will be rounded up.

2. Last drawn salary : Practically it is advisable to take average salary of preceeding twelve months.

For eg : Let the service as 5 years and salary as Rs. 26,000.

Gratuity calculation is = 5 x 26000 x 15/26 = Rs. 75,000.

Note : Now the ceiling limit for gratuity is Rs. 10,00,000. But if employer wish, he can give above Rs. 10,00,000. But as per section 10(10) of Income Tax Act, tax exemption is limited to Rs. 10,00,000. After 5 years if you continue for 6 months and one day in service, you will be eligible to get 6 years' gratuity.


From India, Bangalore
As per the Gratuity Act, one has to complete 5 years of service to be eligible for gratuity. You said that you have completed 4 years and 9 months.
As this juncture, if you leave your organization, you are not entitled to receive gratuity. It is upto you to postpone your decision of changing your job.
V. Balaji

From India, Madras
Dear Sapna You are eligible for gratuity. As per Gratuity act, you have completed 4 years + 240 days (9 months) to become eligible for gratuity.
From India, Mumbai
Dear Sapana,
I would like to inform you that if you have completed 4 years and 9 months in the job, you will be entitled for the gratutity becoz the as per the act there should be continuation of service for 5 years and for computation of continuation of service if in the fifth year if you have worked for 240 days you are entitled no need to completed five years. Once u complete the 240 days in the fifth year of service you will be entitled for the gratuity provided you have workerd in continuation since joining the organisation and there is no break. So many people have confusion about completing five years but have to read section with definition of continuation service.
Hope this have clear you doubts and if have good opportunity can move ahead in life without worrying about gratuity.
If any queries can revertback to me
Raj Ambalia

Sr. Officer (HR & ADM) Mother Dairy, Gandhinagar

From India, Ahmedabad
Dear HR Colleagues, In fifth year an employee has to complete 240 working days for eligibility of gratuity, not merely 240 days. Regards,
From India, Kakinada
Hi Sapna,
This is in reference to your queries regarding entitlement of Gratuity benefits towards your tenure of services as you have completed 4 yrs and nine months as of now, I like to clarify that your service should be in continuous till date and as far as fifth year is concerned, it requires completion of 240 days working during the year then it will be considered as continuous service for fifith year which is taken into consideration for entiltement for gratuity. So if you fulfil the above ,you are entitled for the gratuity.
please feel free to ask if you ahve any further queries.
Prabhash Kumar
Head - HR
IDFS Pvt. Ltd., Gurgaon

From India, New Delhi
Dear Sir/ ma’am what r the forms we have to fill for epf and esic when we join any new company as well as tell me by which no forms we can withdraw our epf. Waiting for reply Regards Deepti
From India, Gurgaon
Dear Friends
Plz guide me
If basic is more then 6500 in this case pf is applicable r not.
Our UP skilled rate is 3290+1979(5269) basic + VDA,
my question is if this amt above to 5269 so how can I bifercate asper Law?
With Regards
Alka Singh

From India, Delhi

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