Recent Posts

Gratuity

Gratuity:


Gratuity Under Award

Gratuity under Act

Eligibility

Gratuity is paid after completion of 10 years of continuous service or at the time of:

  1. The death of the employee,
  2. Employee becoming physically or mentally incapable of further service,
  3. Termination of Service
  4. Retirement on superannuation and
  5. On voluntary retirement or resignation after 10 years of continuous service

  1. Retirement on superannuation
  2. Resignation after 5 years of service
  3. Death and
  4. Disablement

Formula for calculation

  1. One month pay for each completed years of service upto 15 years
  2. For service exceeding 15 years upto 30 years-NIL
  3. For Service exceeding 30 years- ½ month pay for each completed year of service
  4. Pay = Basic Pay + Special Pay + Officiating Pay + PQP+ increment component of FPP.
  5. Based on last salary drawn
  6. Fraction of year in excess of 6 and more, amount is to be paid on pro-rata basis in case of officers and
  7. counted as full year in case of Award Staff

  1. 15 days wages * Number of years of Service i.e. 15/26 * Pay* No of years of service.
  2. Pay = Basic Pay + DA + Special pay + PQP +Officiating Pay + increment component of FPP
  3. One day Wage = Monthly wage divided by 26
  4. Based on Last drawn Salary
  5. Fraction of year in excess of 6 month will be taken as full year

Maximum Amount Payable

No Limit

Max. Rs.20,00,000


Tax Exemption

Exemption up to Rs.20,00,000

Exemption up to Rs.20,00,000



Gratuity in the Bank is paid to employees and officers both under the Gratuity Act, 1972 (Max. Rs. 20 lakhs) and under the provisions of Bipartite Settlement for Award Staff and as per Officer Service Regulation (OSR) for officers whichever is higher.

Reference: OSR, Gratuity Act 1972, Bank Circulars etc

1 comment:

  1. Sir I retired as Spl. Asst from Bank of India in Feb,2018 and lost the benefit of Gratuity ceiling limit of Rs.20 lacs since the effective date 01.01.2016 was amended by Govt. as 28.03.2018. As per 11th BPS Gratuity is calculaed on 12 months basic pay but not on last drawn basic pay whereas for officers last drawn basic pay taken. I lost the benefit . I request you to pay gratuity to award staff based on last drawn basic pay

    ReplyDelete