How to Calculate Gratuity for Long-term Employee with Reduced Salary Due to Illness?

Dear All,

What is the calculation for gratuity payable if a person has been in employment for 12 years with a basic salary of Rs 15,000 plus DA? This person was absent for more than 15 days every month in the 6 months preceding his resignation due to sickness. During this period, he was drawing only around Rs 7,500, but his salary was much higher in earlier years.

Are we supposed to consider Rs 7,500 as the salary for calculation, or should we use Rs 15,000?

I would be grateful for a reply.

Regards,
Ganapathy

While calculating the gratuity amount, one is required to consider the rate of wages last drawn per month and not the amount actually earned in any month as defined under the Payment of Gratuity Act, 1972.

With Regards,
R.N. Khola