Gratuity Calculation Confusion: Is 8 Years and 6 Months Considered 9 Years of Service?

Dear HR Aspirants,

This is Shekhar working in an automobile manufacturing company in Noida.

I have a query regarding the calculation of gratuity under the Payment of Gratuity Act, 1972. If an employee completes 8 years, 6 months, and 0 days of continuous service, how should I calculate the total number of years of service? Should I consider this as 9 years or 8 years?

Please comment.

If it is 8 years and exactly 6 months, then gratuity shall be computed for 8 years only because a fraction of the service will be rounded off to a year if it is in excess of six months.

B. Saikumar

If it is 8 years, 6 months, and 0 days, gratuity should be calculated for 8 years only.

Dr. Prashanth Verma, Director, Value HR First Consulting.

Completed services and part thereof, such as 8 years and 6 months, should be calculated as 9 years. At the same time, 4 years and 6 months should not be calculated as 5 years.