This is Eswar working as an Accountant. One of the employees has been working for 6 years, 3 months, and 10 days, and has now resigned from the job. We need to pay gratuity to him. His basic salary is Rs. 7604, and Dearness Allowance (DA) is Rs. 3042 at the time he leaves the job.
I am requesting information on how much we have to pay with the complete calculation.
From India, Bangalore
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I am requesting information on how much we have to pay with the complete calculation.
From India, Bangalore
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Formula : Gratuity Calculation= / 26 Amount should approximately be Rs 38629. Kindly cross check before payment.
From India, Pune
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3180From India, Pune
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we have to pay 6.3 or 6 years ?? kindly tell me which is the right calculation as per Gratuity Act.
From India, Bangalore
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From India, Bangalore
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The period should be 6 years for calculating gratuity. (A period in excess of six months is treated as a year).
7604 (Basic) + 3042 (DA) multiplied by 15 days of wages * completed years of service (6) divided by 26 days will be the amount of gratuity.
From India, Pune
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7604 (Basic) + 3042 (DA) multiplied by 15 days of wages * completed years of service (6) divided by 26 days will be the amount of gratuity.
From India, Pune
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Gratuity Calculation:
[ (Basic Pay + D.A) times 15 text{ days} times text{No. of years of service} div 26 ]
Where,
D.A = Dearness Allowance.
End of Service Benefits Eligibility:
1. Any person employed on wages/salary.
2. At the time of retirement, resignation, or superannuation, an employee should have rendered continuous service of not less than five years.
3. Payable without completion of five years only in the cases of death and disablement.
From India, Pune
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[ (Basic Pay + D.A) times 15 text{ days} times text{No. of years of service} div 26 ]
Where,
D.A = Dearness Allowance.
End of Service Benefits Eligibility:
1. Any person employed on wages/salary.
2. At the time of retirement, resignation, or superannuation, an employee should have rendered continuous service of not less than five years.
3. Payable without completion of five years only in the cases of death and disablement.
From India, Pune
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Thank you NATHRAO you are spend time for clear my doubts and if you don’t mind can you forward to me gratuity eligibility rules if you available.
From India, Bangalore
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From India, Bangalore
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Some extracts of Payment of Gratuity Act
Applicability of The Act
The Payment of Gratuity Act, 1972 is applicable to the following:
- every factory, mine, oilfield, plantation, port, and railway company;
- every shop or establishment within the meaning of any law in which ten or more persons are employed, or were employed, on any day of the preceding twelve months;
- such other establishments or class of establishments, in which ten or more employees are employed, or were employed, on any day of the preceding twelve months, as the Central Government may, by notification, specify in this behalf.
Once the Payment of Gratuity Act becomes applicable to an organization, the Act would continue to be applicable to the same despite the fact that the number of employees gets reduced than the minimum prescribed.
An employee is any person (other than an apprentice) employed on wages, in any establishment, factory, mine, oilfield, plantation, port, railway company, or shop, to do any skilled, semi-skilled, or unskilled, manual, supervisory, technical, or clerical work, whether the terms of such employment are expressed or implied and whether or not such person is employed in a managerial or administrative capacity, but does not include any such person who holds a post under the Central Government or a State Government and is governed by any other Act or by any rules providing for payment of gratuity.
An employee who has rendered not less than five years of service becomes entitled to gratuity on his superannuation or on his retirement or resignation or on his death or disablement.
The prerequisite of completion of continuous service of five years shall not be necessary where the termination of the employment of any employee is due to death or disablement. Disablement in such a case would mean disablement which incapacitates an employee for the work which he was capable of performing before the accident or disease resulting in such disablement.
Meaning of Continuous Service
Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years.
Gratuity payment is exempt from tax.
The employer has to pay gratuity within 30 days from the date it becomes payable.
These are some important features of gratuity payment.
From India, Pune
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Applicability of The Act
The Payment of Gratuity Act, 1972 is applicable to the following:
- every factory, mine, oilfield, plantation, port, and railway company;
- every shop or establishment within the meaning of any law in which ten or more persons are employed, or were employed, on any day of the preceding twelve months;
- such other establishments or class of establishments, in which ten or more employees are employed, or were employed, on any day of the preceding twelve months, as the Central Government may, by notification, specify in this behalf.
Once the Payment of Gratuity Act becomes applicable to an organization, the Act would continue to be applicable to the same despite the fact that the number of employees gets reduced than the minimum prescribed.
An employee is any person (other than an apprentice) employed on wages, in any establishment, factory, mine, oilfield, plantation, port, railway company, or shop, to do any skilled, semi-skilled, or unskilled, manual, supervisory, technical, or clerical work, whether the terms of such employment are expressed or implied and whether or not such person is employed in a managerial or administrative capacity, but does not include any such person who holds a post under the Central Government or a State Government and is governed by any other Act or by any rules providing for payment of gratuity.
An employee who has rendered not less than five years of service becomes entitled to gratuity on his superannuation or on his retirement or resignation or on his death or disablement.
The prerequisite of completion of continuous service of five years shall not be necessary where the termination of the employment of any employee is due to death or disablement. Disablement in such a case would mean disablement which incapacitates an employee for the work which he was capable of performing before the accident or disease resulting in such disablement.
Meaning of Continuous Service
Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years.
Gratuity payment is exempt from tax.
The employer has to pay gratuity within 30 days from the date it becomes payable.
These are some important features of gratuity payment.
From India, Pune
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Payment of Gratuity Act, 1972 & The Rules.ppt
THE PAYMENT OF GRATUITY ACT 1972.doc