Under provision 1 to Section 4(1), the provision of continuous service of 5 years shall not be necessary where did termination of employment happened due to death or disablement. In case of death the amount of gratuity be paid to the nominee. If there was no nomination made gratuity shall be paid to the heir. Where the nominee or heir is a minor then the amount of gratuity shall be submitted to the controlling authority. The minor can use this fund when he attains majority.
For Every completed year of service or part there of in excess of 6 months the employer shall pay gratuity to an employee at the rate of 15 days wages based on rate of wages last drawn by the employee concerned.
According to explanation under section 4(2), if the wages is paid monthly then the per day wage for the pupose of calculation of gratuity will be calculated as follows :-
Salary/Wages For Gratuity = Rate of Monthly Wage Last Drawn * 15 /26
In case of employee paid on piece rate basis, daily wages is computed as average of total wages received in a period of 3 months immediately preceding the date of termination. For this purpose, the wages paid for any overtime work shall not be taken into account.
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Payment of Gratuity Act, Rules, Forms, Returns & All Other Information