Home | Gratuity Act | Calculation | Calculator | Formula | Rules | Gratuity Meaning | Eligibility

Gratuity Formula

Below are the gratuity calculation formula [Section 4]:-

  • Monthly Salaried Employee

    Gratuity = Last drawn wages × 15/26 × Completed years of Service (including a part of year in excess of six months)

    Note:
    Wages = Last Drawn
    Month = Period of 26 Days
    15 days wages = Last drawn wages × 15/26

  • Piece Rated Employee

    Gratuity = Last drawn wages × 15/26 × Completed years of Service (including a part of year in excess of six months)

    Note:
    Last drawn Wages = Total wages received during three months immediately preceding termination /Days actually worked
    Last drawn wages shall not include overtime wages.

  • Employee of a Seasonal Establishment.

    Employee of seasonal establishment shall be paid gratuity at the rate of 7 days wages for each season.