Gratuity Calculation Confusion: Can Anyone Share a Simple Example?

How to Calculate Gratuity

Please provide an example.

Gratuity Calculation Formula

Please find below the calculation for gratuity:

Basic / 26 * 15 * number of years of service = gratuity

Thank you.

The calculation of Mr. Sivasankaran is not correct.

Regards,
Varghese Mathew
[Phone Number Removed For Privacy Reasons]

Sorry for any confusion caused. (Basic plus DA/26) * 815 * Number of years of continuous service. In my earlier post, I missed the number 15, which is meant to calculate half a month's wages.

Hi all, can any of you clarify for me whether everybody is entitled to gratuity? I mean, will this also be received during retirement time?

Regards,
Ss

As per my knowledge, an employee should have rendered continuous service of not less than five years.

Gratuity Calculation Example

No of Years | Salary (Earned Basic + D.A) | Calculated Salary (B/26*15) | Calculated Gratuity (A*C) | Maximum Gratuity | Applicable Gratuity
(A) | (B) | (C) | (D) | (E)
6 | 10000 | 5769 | 34615 | 1000000 | 34615

The Act states:
- 4 years 8 months (or 240 days to be precise for organizations working 6 days a week)
- 4 years 190 days (in the case of an employee employed below the ground in a mine or in an establishment which works for less than six days in a week)

In case of death or disablement, the gratuity is payable, even if the employee has not completed 5 years of service.

Hope you are now clear about the rules.

Thks,
Vijayan

Retiring employees are also eligible for gratuity.

Regards,
Varghese Mathew
[Phone Number Removed For Privacy Reasons]