{"id":1673,"date":"2025-05-14T07:34:17","date_gmt":"2025-05-14T07:34:17","guid":{"rendered":"https:\/\/www.arribahrms.com\/blogs\/?p=1673"},"modified":"2025-05-16T07:22:34","modified_gmt":"2025-05-16T07:22:34","slug":"gratuity-policy","status":"publish","type":"post","link":"https:\/\/www.arribahrms.com\/blogs\/gratuity-policy\/","title":{"rendered":"Gratuity Policy"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-post\" data-elementor-id=\"1673\" class=\"elementor elementor-1673\" data-elementor-post-type=\"post\">\n\t\t\t\t<div class=\"elementor-element elementor-element-2a83a957 e-flex e-con-boxed wpr-particle-no wpr-jarallax-no wpr-parallax-no wpr-sticky-section-no wpr-equal-height-no e-con e-parent\" data-id=\"2a83a957\" data-element_type=\"container\" data-e-type=\"container\">\n\t\t\t\t\t<div class=\"e-con-inner\">\n\t\t<div class=\"elementor-element elementor-element-618d9a44 e-con-full e-flex wpr-particle-no wpr-jarallax-no wpr-parallax-no wpr-sticky-section-no wpr-equal-height-no e-con e-child\" data-id=\"618d9a44\" data-element_type=\"container\" data-e-type=\"container\">\n\t\t\t\t<\/div>\n\t\t<div class=\"elementor-element elementor-element-4da2837d e-con-full e-flex wpr-particle-no wpr-jarallax-no wpr-parallax-no wpr-sticky-section-no wpr-equal-height-no e-con e-child\" data-id=\"4da2837d\" data-element_type=\"container\" data-e-type=\"container\">\n\t\t\t\t<div class=\"elementor-element elementor-element-5153757e elementor-widget elementor-widget-elementskit-heading\" data-id=\"5153757e\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"elementskit-heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<div class=\"ekit-wid-con\" ><div class=\"ekit-heading elementskit-section-title-wraper center   ekit_heading_tablet-   ekit_heading_mobile-\"><h1 class=\"ekit-heading--title elementskit-section-title \">Gratuity Policy Template: Secure Employee Benefits, Stay Compliant<\/h1><div class=\"ekit_heading_separetor_wraper ekit_heading_elementskit-border-divider ekit-dotted\"><div class=\"elementskit-border-divider ekit-dotted\"><\/div><\/div>\t\t\t\t<div class='ekit-heading__description'>\n\t\t\t\t\t<p class=\"\">Define your gratuity rules clearly with this ready-to-use policy template and forms. Stay aligned with the Payment of Gratuity Act, 1972 and reward long-serving employees fairly.<\/p>\n\t\t\t\t<\/div>\n\t\t\t<\/div><\/div>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t<div class=\"elementor-element elementor-element-7b915a62 e-flex e-con-boxed wpr-particle-no wpr-jarallax-no wpr-parallax-no wpr-sticky-section-no wpr-equal-height-no e-con e-parent\" data-id=\"7b915a62\" data-element_type=\"container\" data-e-type=\"container\">\n\t\t\t\t\t<div class=\"e-con-inner\">\n\t\t<div class=\"elementor-element elementor-element-d484959 e-con-full e-flex wpr-particle-no wpr-jarallax-no wpr-parallax-no wpr-sticky-section-no wpr-equal-height-no e-con e-child\" data-id=\"d484959\" data-element_type=\"container\" data-e-type=\"container\">\n\t\t\t\t<div class=\"elementor-element elementor-element-8007e9d elementor-widget__width-initial elementor-widget elementor-widget-shortcode\" data-id=\"8007e9d\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"shortcode.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<div class=\"elementor-shortcode\">\n<!-- Font Awesome -->\n<link href=\"https:\/\/cdnjs.cloudflare.com\/ajax\/libs\/font-awesome\/6.5.0\/css\/all.min.css\" rel=\"stylesheet\" \/>\n\n<!-- Sidebar HTML -->\n<div class=\"policy-sidebar\">\n  <ul>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/hr-policies\/\"><i class=\"fas fa-chart-pie\"><\/i> Introduction<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/code-of-conduct\/\"><i class=\"fas fa-book\"><\/i> Code of Conduct Policy<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/moonlighting-policy\/\"><i class=\"fas fa-moon\"><\/i> Moonlighting Policy<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/posh-policy\"><i class=\"fas fa-shield-alt\"><\/i> POSH Policy<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/recruitment-policy\/\"><i class=\"fas fa-user-plus\"><\/i> Recruitment Policy<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/work-from-home-policy\/\"><i class=\"fas fa-laptop-house\"><\/i> Work From Home Policy<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/leave-policy\/\"><i class=\"fas fa-calendar-minus\"><\/i> Leave Policy<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/whistleblowing-policy\/\"><i class=\"fas fa-bullhorn\"><\/i> Whistleblower Policy<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/pto-policy\"><i class=\"fas fa-plane-departure\"><\/i> PTO Policy<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/gratuity-policy\"><i class=\"fas fa-gift\"><\/i> Gratuity Policy<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/social-media-policy\/\"><i class=\"fas fa-hashtag\"><\/i> Social Media Policy<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/health-and-safety-policy\/\"><i class=\"fas fa-first-aid\"><\/i> Health and Safety Policy<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/employee-referral-policy\/\"><i class=\"fas fa-user-friends\"><\/i> Employee Referral Policy<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/dress-code-policy\"><i class=\"fas fa-tshirt\"><\/i> Dress Code Policy<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/employee-termination-policy\/\"><i class=\"fas fa-user-slash\"><\/i> Employee Termination Policy<\/a><\/li>\n    <li><a href=\"https:\/\/www.arribahrms.com\/blogs\/promotion-policy\/\"><i class=\"fas fa-arrow-up\"><\/i> Promotion Policy<\/a><\/li>\n  <\/ul>\n<\/div>\n\n<!-- Highlight Active Link -->\n<script>\n  document.addEventListener(\"DOMContentLoaded\", function () {\n    const currentUrl = window.location.href;\n    document.querySelectorAll(\".policy-sidebar a\").forEach(link => {\n      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 color: #024430;\n}\n<\/style>\n\n\n<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t<div class=\"elementor-element elementor-element-603df66 e-con-full e-flex wpr-particle-no wpr-jarallax-no wpr-parallax-no wpr-sticky-section-no wpr-equal-height-no e-con e-child\" data-id=\"603df66\" data-element_type=\"container\" data-e-type=\"container\">\n\t\t<div class=\"elementor-element elementor-element-30330fa e-con-full form-card e-flex wpr-particle-no wpr-jarallax-no wpr-parallax-no wpr-sticky-section-no wpr-equal-height-no e-con e-child\" data-id=\"30330fa\" data-element_type=\"container\" data-e-type=\"container\" data-settings=\"{&quot;background_background&quot;:&quot;classic&quot;}\">\n\t\t\t\t<div class=\"elementor-element elementor-element-237f40e elementor-widget__width-inherit elementor-widget elementor-widget-heading\" data-id=\"237f40e\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<h3 class=\"elementor-heading-title elementor-size-default\">Book Free Trial Now!<\/h3>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-f04165c elementor-widget__width-inherit wpr-step-type-number_text wpr-step-content-layout-vertical wpr-custom-styles-yes elementor-widget elementor-widget-wpr-form-builder\" data-id=\"f04165c\" data-element_type=\"widget\" data-e-type=\"widget\" data-settings=\"{&quot;success_message&quot;:&quot;Submission successful&quot;,&quot;error_message&quot;:&quot;Submission failed&quot;,&quot;button_width&quot;:{&quot;unit&quot;:&quot;%&quot;,&quot;size&quot;:100,&quot;sizes&quot;:[]},&quot;button_width_tablet&quot;:{&quot;unit&quot;:&quot;px&quot;,&quot;size&quot;:&quot;&quot;,&quot;sizes&quot;:[]},&quot;button_width_mobile&quot;:{&quot;unit&quot;:&quot;px&quot;,&quot;size&quot;:&quot;&quot;,&quot;sizes&quot;:[]},&quot;step_type&quot;:&quot;number_text&quot;,&quot;step_content_layout&quot;:&quot;vertical&quot;}\" data-widget_type=\"wpr-form-builder.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<form class=\"wpr-form\" method=\"post\" id=\"[id=&quot;form&quot;]\" name=\"New Form\" page=\"Gratuity Policy\" page_id=\"1673\" novalidate>\n\t\t\t<input type=\"hidden\" name=\"post_id\" value=\"1673\"\/>\n\t\t\t<input type=\"hidden\" name=\"form_id\" value=\"f04165c\"\/>\n\t\t\t<input type=\"hidden\" name=\"referer_title\" value=\"\" \/>\n\n\t\t\t<div class=\"wpr-step-wrap\"><\/div>\n\t\t\t<div class=\"wpr-form-fields-wrap wpr-labels-above\">\n\t\t\t\t\t\t\t\t\t<div class=\"wpr-form-field-type-text wpr-field-group wpr-column wpr-field-group-name elementor-repeater-item-7b93963\">\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<label for=\"form-field-name\" class=\"wpr-form-field-label\" data-alt-label=\"Name\">\n\t\t\t\t\t\t\t\t\tName\t\t\t\t\t\t\t\t<\/label>\n\t\t\t\t\t\t\t<input size=\"1 \"type=\"text\" name=\"form_fields[name]\" id=\"form-field-name\" class=\"wpr-form-field  wpr-form-field-textual\" placeholder=\"Name\">\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t<div class=\"wpr-form-field-type-email wpr-field-group wpr-column wpr-field-group-email elementor-repeater-item-7e51af4 wpr-form-field-required\">\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<label for=\"form-field-email\" class=\"wpr-form-field-label\" data-alt-label=\"Work Email\">\n\t\t\t\t\t\t\t\t\tWork Email\t\t\t\t\t\t\t\t<\/label>\n\t\t\t\t\t\t\t<input size=\"1 \"type=\"email\" name=\"form_fields[email]\" id=\"form-field-email\" class=\"wpr-form-field  wpr-form-field-textual\" placeholder=\"Work Email\" required=\"required\" aria-required=\"true\">\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t<div class=\"wpr-form-field-type-number wpr-field-group wpr-column wpr-field-group-939a45a elementor-repeater-item-939a45a wpr-form-field-required\">\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<label for=\"form-field-939a45a\" class=\"wpr-form-field-label\" data-alt-label=\"Mobile No.\">\n\t\t\t\t\t\t\t\t\tMobile No.\t\t\t\t\t\t\t\t<\/label>\n\t\t\t\t\t\t\t<input size=\"1 \"type=\"number\" name=\"form_fields[939a45a]\" id=\"form-field-939a45a\" class=\"wpr-form-field  wpr-form-field-textual\" placeholder=\"Mobile No.\" required=\"required\" aria-required=\"true\">\t\t\t\t\t<\/div>\n\t\t\t\t<div class=\"wpr-field-group wpr-stp-btns-wrap wpr-column wpr-form-field-type-submit\" data-actions=\"[&quot;email&quot;]\" data-redirect-url=\"\" data-mailchimp-fields=\"{&quot;email_field&quot;:&quot;&quot;,&quot;first_name_field&quot;:&quot;&quot;,&quot;last_name_field&quot;:&quot;&quot;,&quot;address_field&quot;:&quot;&quot;,&quot;phone_field&quot;:&quot;&quot;,&quot;birthday_field&quot;:&quot;&quot;,&quot;group_id&quot;:&quot;&quot;}\" data-list-id=\"\">\t\t\t<button type=\"submit\" class=\"wpr-button\">\n\t\t\t\t<span >\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<span>Submit<\/span>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/span>\t\n\t\t\t\t<div class=\"wpr-double-bounce wpr-loader-hidden\">\n\t\t\t\t\t<div class=\"wpr-child wpr-double-bounce1\"><\/div>\n\t\t\t\t\t<div class=\"wpr-child wpr-double-bounce2\"><\/div>\n\t\t\t\t<\/div>\n\t\t\t<\/button>\n\t\t<\/div>\t\t\t\t\n\t\t\t<\/div>\n\t\t<\/form>\n\t  \t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t<div class=\"elementor-element elementor-element-3d071067 e-con-full e-flex wpr-particle-no wpr-jarallax-no wpr-parallax-no wpr-sticky-section-no wpr-equal-height-no e-con e-child\" data-id=\"3d071067\" data-element_type=\"container\" data-e-type=\"container\">\n\t\t\t\t<div class=\"elementor-element elementor-element-e79bdd2 elementor-widget__width-inherit elementor-widget elementor-widget-heading\" data-id=\"e79bdd2\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\"><span class=\"ez-toc-section\" id=\"What_is_a_Gratuity_Policy\"><\/span>What is a Gratuity Policy?<span class=\"ez-toc-section-end\"><\/span><\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-2fc757e2 elementor-widget elementor-widget-text-editor\" data-id=\"2fc757e2\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<p class=\"\" data-start=\"826\" data-end=\"1176\">A gratuity policy outlines the financial benefit an organization provides to its employees as a token of appreciation for their long-term service. As per the <strong data-start=\"984\" data-end=\"1017\">Payment of Gratuity Act, 1972<\/strong>, gratuity becomes payable to an employee upon retirement, resignation, or other qualifying events after completing at least <strong data-start=\"1142\" data-end=\"1175\">5 years of continuous service<\/strong>.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-33521d94 elementor-widget__width-inherit elementor-widget elementor-widget-heading\" data-id=\"33521d94\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\"><span class=\"ez-toc-section\" id=\"Applicability_of_the_Gratuity_Act\"><\/span>Applicability of the Gratuity Act<span class=\"ez-toc-section-end\"><\/span><\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-4585de15 elementor-widget elementor-widget-text-editor\" data-id=\"4585de15\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<ul data-start=\"1224\" data-end=\"1541\"><li class=\"\" data-start=\"1224\" data-end=\"1278\"><p class=\"\" data-start=\"1226\" data-end=\"1278\">The act came into effect on <strong data-start=\"1254\" data-end=\"1277\">16th September 1972<\/strong>.<\/p><\/li><li class=\"\" data-start=\"1279\" data-end=\"1433\"><p class=\"\" data-start=\"1281\" data-end=\"1433\">It applies to <strong data-start=\"1295\" data-end=\"1322\">all government entities<\/strong> and <strong data-start=\"1327\" data-end=\"1352\">private organizations<\/strong> employing <strong data-start=\"1363\" data-end=\"1387\">10 or more employees<\/strong> on any single day in the preceding 12 months.<\/p><\/li><li class=\"\" data-start=\"1434\" data-end=\"1541\"><p class=\"\" data-start=\"1436\" data-end=\"1541\">Once applicable, an organization must continue complying, even if the number of employees drops below 10.<\/p><\/li><\/ul>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-32ffe3b1 elementor-widget__width-inherit elementor-widget elementor-widget-heading\" data-id=\"32ffe3b1\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\"><span class=\"ez-toc-section\" id=\"Gratuity_Eligibility_Criteria\"><\/span>Gratuity Eligibility Criteria<span class=\"ez-toc-section-end\"><\/span><\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-2109d6c7 elementor-widget elementor-widget-text-editor\" data-id=\"2109d6c7\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<p class=\"\" data-start=\"1584\" data-end=\"1644\">An employee is eligible for gratuity under these conditions:<\/p><ol data-start=\"1646\" data-end=\"2021\"><li class=\"\" data-start=\"1646\" data-end=\"1716\"><p class=\"\" data-start=\"1649\" data-end=\"1716\"><strong data-start=\"1649\" data-end=\"1668\">Minimum Service<\/strong>: At least <strong data-start=\"1679\" data-end=\"1715\">5 years of continuous employment<\/strong>.<\/p><\/li><li class=\"\" data-start=\"1717\" data-end=\"1792\"><p class=\"\" data-start=\"1720\" data-end=\"1792\"><strong data-start=\"1720\" data-end=\"1736\">Working Days<\/strong>: At least <strong data-start=\"1747\" data-end=\"1759\">240 days<\/strong> in a year (190 days for miners).<\/p><\/li><li class=\"\" data-start=\"1793\" data-end=\"1890\"><p class=\"\" data-start=\"1796\" data-end=\"1890\"><strong data-start=\"1796\" data-end=\"1821\">Interruptions Covered<\/strong>: Periods like strikes, layoffs, or accidents don\u2019t break continuity.<\/p><\/li><li class=\"\" data-start=\"1891\" data-end=\"2021\"><p class=\"\" data-start=\"1894\" data-end=\"1916\"><strong data-start=\"1894\" data-end=\"1915\">Applicable Events<\/strong>:<\/p><\/li><\/ol><ul><li data-start=\"1922\" data-end=\"1933\">Resignation<\/li><li data-start=\"1939\" data-end=\"1949\">Retirement<\/li><li data-start=\"1955\" data-end=\"1966\">Disablement<\/li><li data-start=\"1972\" data-end=\"1977\">Death<\/li><li data-start=\"1983\" data-end=\"2021\">Termination (under certain conditions)<\/li><\/ul>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-7e011b7 elementor-widget__width-inherit elementor-widget elementor-widget-heading\" data-id=\"7e011b7\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\"><span class=\"ez-toc-section\" id=\"How_to_Calculate_Gratuity\"><\/span>How to Calculate Gratuity<span class=\"ez-toc-section-end\"><\/span><\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-dac932c elementor-widget elementor-widget-text-editor\" data-id=\"dac932c\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<p class=\"\" data-start=\"2061\" data-end=\"2147\"><strong data-start=\"2061\" data-end=\"2073\">Formula:<\/strong><br data-start=\"2073\" data-end=\"2076\" \/><code data-start=\"2076\" data-end=\"2147\">Gratuity = (15 \u00d7 Last drawn salary \u00d7 Completed years of service) \/ 26<\/code><\/p><ul data-start=\"2149\" data-end=\"2302\"><li class=\"\" data-start=\"2149\" data-end=\"2211\"><p class=\"\" data-start=\"2151\" data-end=\"2211\"><strong data-start=\"2151\" data-end=\"2161\">Salary<\/strong> includes only <strong data-start=\"2176\" data-end=\"2210\">basic pay + dearness allowance<\/strong>.<\/p><\/li><li class=\"\" data-start=\"2212\" data-end=\"2302\"><p class=\"\" data-start=\"2214\" data-end=\"2302\">If an employee has served more than <strong data-start=\"2250\" data-end=\"2272\">6 months in a year<\/strong>, it&#8217;s rounded to a full year.<\/p><\/li><\/ul><p class=\"\" data-start=\"2304\" data-end=\"2468\"><strong data-start=\"2304\" data-end=\"2316\">Example:<\/strong><br data-start=\"2316\" data-end=\"2319\" \/>If Mr. X worked for 19 years and 2 months and his last drawn salary (basic + DA) was \u20b91,30,000:<br data-start=\"2414\" data-end=\"2417\" \/><code data-start=\"2417\" data-end=\"2468\">Gratuity = (15 \u00d7 1,30,000 \u00d7 19) \/ 26 = \u20b914,25,000<\/code><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-b1b7ecf elementor-widget__width-inherit elementor-widget elementor-widget-heading\" data-id=\"b1b7ecf\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\"><span class=\"ez-toc-section\" id=\"Gratuity_Forfeiture_Rules\"><\/span>Gratuity Forfeiture Rules<span class=\"ez-toc-section-end\"><\/span><\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-ac16343 elementor-widget elementor-widget-text-editor\" data-id=\"ac16343\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<p class=\"\" data-start=\"2507\" data-end=\"2592\">Gratuity may be forfeited, wholly or partially, if the employee is terminated due to:<\/p><ul data-start=\"2594\" data-end=\"2717\"><li class=\"\" data-start=\"2594\" data-end=\"2635\"><p class=\"\" data-start=\"2596\" data-end=\"2635\">Fraudulent behavior or criminal offense<\/p><\/li><li class=\"\" data-start=\"2636\" data-end=\"2667\"><p class=\"\" data-start=\"2638\" data-end=\"2667\">Violent or disorderly conduct<\/p><\/li><li class=\"\" data-start=\"2668\" data-end=\"2717\"><p class=\"\" data-start=\"2670\" data-end=\"2717\">Willful negligence causing loss to the employer<\/p><\/li><\/ul>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-bae3394 elementor-widget__width-inherit elementor-widget elementor-widget-heading\" data-id=\"bae3394\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\"><span class=\"ez-toc-section\" id=\"Tax_Implications_on_Gratuity\"><\/span>Tax Implications on Gratuity<span class=\"ez-toc-section-end\"><\/span><\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-ae07a03 elementor-widget elementor-widget-text-editor\" data-id=\"ae07a03\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<ul data-start=\"2760\" data-end=\"3012\"><li class=\"\" data-start=\"2760\" data-end=\"2821\"><p class=\"\" data-start=\"2762\" data-end=\"2821\"><strong data-start=\"2762\" data-end=\"2786\">Government Employees<\/strong>: Gratuity is <strong data-start=\"2800\" data-end=\"2820\">fully tax-exempt<\/strong>.<\/p><\/li><li class=\"\" data-start=\"2822\" data-end=\"2920\"><p class=\"\" data-start=\"2824\" data-end=\"2920\"><strong data-start=\"2824\" data-end=\"2852\">Private Sector Employees<\/strong>: Exempt up to \u20b920 lakhs under Section 10(10) of the Income Tax Act.<\/p><\/li><li class=\"\" data-start=\"2921\" data-end=\"3012\"><p class=\"\" data-start=\"2923\" data-end=\"3012\"><strong data-start=\"2923\" data-end=\"2943\">In Case of Death<\/strong>: Gratuity paid to the nominee\/legal heir is <strong data-start=\"2988\" data-end=\"3011\">completely tax-free<\/strong>.<\/p><\/li><\/ul>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-ed2ebfc elementor-widget__width-inherit elementor-widget elementor-widget-heading\" data-id=\"ed2ebfc\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\"><span class=\"ez-toc-section\" id=\"Gratuity_Request_Form_Template\"><\/span>Gratuity Request Form (Template)<span class=\"ez-toc-section-end\"><\/span><\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-ae8a5f6 elementor-widget elementor-widget-text-editor\" data-id=\"ae8a5f6\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<p>To, <br \/>[Employer\u2019s Name] <br \/>[Company Name] <br \/>[Location]<\/p><p>Subject: Application for Payment of Gratuity<\/p><p>Dear Sir\/Madam, <br \/>I am writing to request the release of my gratuity payment under Section 4(1) of the Payment of Gratuity Act, 1972. I have completed [X] years of service and was separated from service on [Last Working Date] due to [Reason \u2013 resignation\/retirement\/disablement].<\/p><p>Please find the required details below:<\/p><p>1. Full Name: [Your Name] <br \/>2. Address: [Your Address] <br \/>3. Department: [Your Department] <br \/>4. Date of Joining: [DD\/MM\/YYYY] <br \/>5. Reason for Separation: [Resignation\/Retirement\/Disablement] <br \/>6. Total Service Duration: [Years Completed] <br \/>7. Last Drawn Wages: \u20b9[Amount] <br \/>8. Gratuity Amount Claimed: \u20b9[Amount] <br \/>9. Supporting Documents: [If applicable] <br \/>10. Preferred Mode of Payment: Cash\/Cheque\/Bank Transfer<\/p><p>Sincerely, <br \/>[Signature] <br \/>[Date]<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-a056152 elementor-widget__width-inherit elementor-widget elementor-widget-heading\" data-id=\"a056152\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\"><span class=\"ez-toc-section\" id=\"Gratuity_Payment_Approval_Form_Form_L\"><\/span>Gratuity Payment Approval Form (Form 'L')<span class=\"ez-toc-section-end\"><\/span><\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-88137a9 elementor-widget elementor-widget-text-editor\" data-id=\"88137a9\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<p>NOTICE FOR PAYMENT OF GRATUITY <br \/>(Form L &#8211; As per Rule 8 of Payment of Gratuity Rules, 1972)<\/p><p>To, <br \/>[Employee\/Legal Heir Name] <br \/>[Address]<\/p><p>You are hereby informed that a gratuity amount of \u20b9[Amount] is payable to you for your service at [Company Name] under the Payment of Gratuity Act, 1972.<\/p><p>Kindly collect the amount via [Cheque\/Cash] on [Date] from [Location]. Alternatively, it will be sent to your address by registered post.<\/p><p>Gratuity Calculation Summary: <br \/>&#8211; Total Service: [X Years Y Months] <br \/>&#8211; Last Drawn Wages: \u20b9[Amount] <br \/>&#8211; Gratuity Payable: \u20b9[Amount]<\/p><p>Authorized Signatory: <br \/>[Officer\u2019s Name &amp; Signature] <br \/>[Date &amp; Place]<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"<p>Gratuity Policy Template: Secure Employee Benefits, Stay Compliant Define your gratuity rules clearly with this ready-to-use policy template and forms. Stay aligned with the Payment of Gratuity Act, 1972 and reward long-serving employees fairly. Book Free Trial Now! Name Work Email Mobile No. Submit What is a Gratuity Policy? A gratuity policy outlines the financial benefit an organization provides to its employees as a token of appreciation for their long-term service. As per the Payment of Gratuity Act, 1972, gratuity becomes payable to an employee upon retirement, resignation, or other qualifying events after completing at least 5 years of continuous service. Applicability of the Gratuity Act The act came into effect on 16th September 1972. It applies to all government entities and private organizations employing 10 or more employees on any single day in the preceding 12 months. Once applicable, an organization must continue complying, even if the number of employees drops below 10. Gratuity Eligibility Criteria An employee is eligible for gratuity under these conditions: Minimum Service: At least 5 years of continuous employment. Working Days: At least 240 days in a year (190 days for miners). Interruptions Covered: Periods like strikes, layoffs, or accidents don\u2019t break continuity. Applicable Events: Resignation Retirement Disablement Death Termination (under certain conditions) How to Calculate Gratuity Formula:Gratuity = (15 \u00d7 Last drawn salary \u00d7 Completed years of service) \/ 26 Salary includes only basic pay + dearness allowance. If an employee has served more than 6 months in a year, it&#8217;s rounded to a full year. Example:If Mr. X worked for 19 years and 2 months and his last drawn salary (basic + DA) was \u20b91,30,000:Gratuity = (15 \u00d7 1,30,000 \u00d7 19) \/ 26 = \u20b914,25,000 Gratuity Forfeiture Rules Gratuity may be forfeited, wholly or partially, if the employee is terminated due to: Fraudulent behavior or criminal offense Violent or disorderly conduct Willful negligence causing loss to the employer Tax Implications on Gratuity Government Employees: Gratuity is fully tax-exempt. Private Sector Employees: Exempt up to \u20b920 lakhs under Section 10(10) of the Income Tax Act. In Case of Death: Gratuity paid to the nominee\/legal heir is completely tax-free. Gratuity Request Form (Template) To, [Employer\u2019s Name] [Company Name] [Location] Subject: Application for Payment of Gratuity Dear Sir\/Madam, I am writing to request the release of my gratuity payment under Section 4(1) of the Payment of Gratuity Act, 1972. I have completed [X] years of service and was separated from service on [Last Working Date] due to [Reason \u2013 resignation\/retirement\/disablement]. Please find the required details below: 1. Full Name: [Your Name] 2. Address: [Your Address] 3. Department: [Your Department] 4. Date of Joining: [DD\/MM\/YYYY] 5. Reason for Separation: [Resignation\/Retirement\/Disablement] 6. Total Service Duration: [Years Completed] 7. Last Drawn Wages: \u20b9[Amount] 8. Gratuity Amount Claimed: \u20b9[Amount] 9. Supporting Documents: [If applicable] 10. Preferred Mode of Payment: Cash\/Cheque\/Bank Transfer Sincerely, [Signature] [Date] Gratuity Payment Approval Form (Form &#8216;L&#8217;) NOTICE FOR PAYMENT OF GRATUITY (Form L &#8211; As per Rule 8 of Payment of Gratuity Rules, 1972) To, [Employee\/Legal Heir Name] [Address] You are hereby informed that a gratuity amount of \u20b9[Amount] is payable to you for your service at [Company Name] under the Payment of Gratuity Act, 1972. Kindly collect the amount via [Cheque\/Cash] on [Date] from [Location]. Alternatively, it will be sent to your address by registered post. Gratuity Calculation Summary: &#8211; Total Service: [X Years Y Months] &#8211; Last Drawn Wages: \u20b9[Amount] &#8211; Gratuity Payable: \u20b9[Amount] Authorized Signatory: [Officer\u2019s Name &amp; Signature] [Date &amp; Place]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"elementor_header_footer","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[104],"tags":[],"class_list":["post-1673","post","type-post","status-publish","format-standard","hentry","category-policies"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.arribahrms.com\/blogs\/wp-json\/wp\/v2\/posts\/1673","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.arribahrms.com\/blogs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.arribahrms.com\/blogs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.arribahrms.com\/blogs\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.arribahrms.com\/blogs\/wp-json\/wp\/v2\/comments?post=1673"}],"version-history":[{"count":19,"href":"https:\/\/www.arribahrms.com\/blogs\/wp-json\/wp\/v2\/posts\/1673\/revisions"}],"predecessor-version":[{"id":1934,"href":"https:\/\/www.arribahrms.com\/blogs\/wp-json\/wp\/v2\/posts\/1673\/revisions\/1934"}],"wp:attachment":[{"href":"https:\/\/www.arribahrms.com\/blogs\/wp-json\/wp\/v2\/media?parent=1673"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.arribahrms.com\/blogs\/wp-json\/wp\/v2\/categories?post=1673"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.arribahrms.com\/blogs\/wp-json\/wp\/v2\/tags?post=1673"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}