Labour Law
India
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1 days ago
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What is the eligibility and calculation of gratuity under the Payment of Gratuity Act?
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Below is a comprehensive legal analysis based on Indian law for your question.
Gratuity is payable under the Payment of Gratuity Act, 1972 to an employee who has completed at least five years of continuous service (subject to exceptions for death or disablement). It is calculated at 15 days' wages for every completed year of service, with the formula: (Last drawn basic + DA) x 15 x completed years / 26, capped at Rs. 20 lakh. The Payment of Gratuity (Amendment) Act, 2018 raised the tax-exempt ceiling to Rs. 20 lakh.
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