Gratuity Calculation: How Many Years Count for 20 Years and 6 Months of Service?

Hi all, I am Sumit Sharma, and I have a question. If an employee completes 20 years and 6 months of service, how many years will the gratuity be calculated on?

Hi, gratuity will be calculated for 20 years.

Sir, if he worked for 20 years, 6 months, and 17 days, then how many years will the gratuity be calculated on?

Hi, what about the working days for your company? Is it 5 days a week or 6 days a week? Six months and 17 days are equivalent to 199.5 days. This needs to be treated as 1 year if your company follows a 5-day week. Accordingly, gratuity eligibility will be for 21 years. However, if your company follows a 6-day week pattern, then 240 days are required in the last year to consider it as one year. As per section 2A, an employee is said to be in continuous service of one year if the employee has completed 190 days in the case of a 5-day week working company and 240 days in the case of a 6-day week working company.

Fraction of months more than six months shall be rounded as one year. Since the employee has worked for 20 years, 6 months, and 17 days, he should be paid gratuity for 21 years. Even one day more than six months will qualify for one year of gratuity.

Thank you.

Continuous service is different from the length of service. The concept of 240 days and 190 days is used to determine if the employee has continuous service or not. This is an issue of length of service extending beyond a year, comprising six months, and for that, 190/240 need not be considered.