Hi, I recently left an organization on 29 April where I had worked for 5 years and was eligible for gratuity. However, on my last working day, the employer has shared a mass email to all the employees stating new salary structure and standardizing basic to 50%. This has impacted my gratuity. Can anyone shed light on this if this is legal or can be challenged and how.

Looking forward to you response.


From India, Noida
Dinesh Divekar
Business Mentor, Consultant And Trainer
Industrial Relations And Labour Laws

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You can demand the gratuity based on our actual salary. Salary means the full gross salary. It is a misinterpretation that gratuity is payable only on basic salary. The definition of basic wages under EPF Act and Gratuity Act are almost same and the Supreme Court has given a clarification on the wages as defined in the EPF & MP Act. The same principle can be adapted in the case of gratuity also. Please follow the link given below for further information.

Madhu T K: Payment of Gratuity and Gratuity Qualifying Salary

After reading the article in the link, if you have any query please put it here.

From India, Kannur
Dinesh Divekar

Dear member,

You say that your employer standardised basic to 50% just a few days before you left your company. But then what was your earlier basic? Has it been reduced? Has it caused you financial loss? What would have been the amount had there not been standardisation and what is the amount after the standardisation?

Please clarify.


Dinesh Divekar

From India, Bangalore

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