I would like to know what the gratuity will be if a person completes 5 years in one company, or if he/she completes 3 or 4 years in one company without a break. Is it 21 days' payment x 5 years? Please provide me with the HR regulations too.
Regards,
Quamar
From India, Mumbai
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2Regards,
Quamar
From India, Mumbai
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Gratuity Calculation and Eligibility
Gratuity is calculated at the rate of 15 days' wages (Basic + DA) of the employee at the time of leaving the service after completing at least 5 years. The amount will be equal to 15 days' pay for every completed year of service. A fraction of a year of more than 6 months will be taken as one year; thus, an employee who is leaving after working for 7 years, 6 months, and 1 day will get gratuity for 8 years. The average daily rate of salary is calculated by dividing the monthly salary (Basic + DA only) by 26.
To be eligible for gratuity, the employee should have worked continuously (without a break), and a period of one year is considered continuous if he has worked for at least 240 days in that year.
An employee who has not worked for 5 years cannot get gratuity. Although there are ongoing discussions about the eligibility of an employee who has put in 4 years and 240 days in the fifth year based on court judgments, the Payment of Gratuity Act remains unamended.
The maximum gratuity amount admissible as per the Act is Rs 10 lakhs.
In the case of the death of an employee without completing five years, the dependents are eligible to get gratuity even though the deceased did not complete five years.
Regards,
Madhu.T.K
From India, Kannur
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Gratuity is calculated at the rate of 15 days' wages (Basic + DA) of the employee at the time of leaving the service after completing at least 5 years. The amount will be equal to 15 days' pay for every completed year of service. A fraction of a year of more than 6 months will be taken as one year; thus, an employee who is leaving after working for 7 years, 6 months, and 1 day will get gratuity for 8 years. The average daily rate of salary is calculated by dividing the monthly salary (Basic + DA only) by 26.
To be eligible for gratuity, the employee should have worked continuously (without a break), and a period of one year is considered continuous if he has worked for at least 240 days in that year.
An employee who has not worked for 5 years cannot get gratuity. Although there are ongoing discussions about the eligibility of an employee who has put in 4 years and 240 days in the fifth year based on court judgments, the Payment of Gratuity Act remains unamended.
The maximum gratuity amount admissible as per the Act is Rs 10 lakhs.
In the case of the death of an employee without completing five years, the dependents are eligible to get gratuity even though the deceased did not complete five years.
Regards,
Madhu.T.K
From India, Kannur
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Calculation of Gratuity
The formula for calculating gratuity is: 15/26 x (last drawn Basic + DA) x years of service. Anyone can claim gratuity after completing 5 years of service in the organization.
Maximum Limit of Gratuity
The maximum limit for gratuity is up to 10 lakh, as per the act.
Regards,
Swarnali Banerjee.
From India, Madras
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The formula for calculating gratuity is: 15/26 x (last drawn Basic + DA) x years of service. Anyone can claim gratuity after completing 5 years of service in the organization.
Maximum Limit of Gratuity
The maximum limit for gratuity is up to 10 lakh, as per the act.
Regards,
Swarnali Banerjee.
From India, Madras
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Hi, I have a query, can employee claim GRATUITY if he is still in organisation after completing 5years. Bhanu Prakash
From India, Mumbai
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From India, Mumbai
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No, he can claim gratuity only when he leaves the company. Madhu.T.K
From India, Kannur
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From India, Kannur
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Payment of Gratuity Act, 1972 & The Rules.ppt
THE PAYMENT OF GRATUITY ACT 1972.doc