These government employees will not get gratuity of Rs 25 lakh!
Last year, the Department of Pension and Pensioners Welfare (DoPPW) increased the maximum limit of gratuity for central government employees by 25 per cent to Rs 25 lakh. This change came into effect from january 1, 2024, when dearness allowance (DA) reached 50 per cent. However, it is not necessary that every government employee gets this full amount.
How is gratuity calculated?
Gratuity is calculated on the basis of a special formula. According to the rule, the employee gets 16.5 times his last salary (basic pay + dearness allowance) or Rs 25 lakh, whichever is less, as gratuity. This means that not every employee will get Rs 25 lakh, but gratuity will be decided on the basis of their service period and salary.
Types of Gratuity
government employees get two types of gratuity – retirement gratuity and death gratuity.
Retirement Gratuity
One-fourth of the basic pay + dearness allowance is added for every 6 months of service.
A maximum of 16.5 times the salary or Rs 25 lakh, whichever is less, will be given.
A minimum of 5 years of service is mandatory to get gratuity.
Death Gratuity
If the employee dies during service, his family will get gratuity as per this formula-
Less than 1 year of service: 2 times the salary
1 to 5 years: 6 times the salary
5 to 11 years: 12 times the salary
11 to 20 years: 20 times the salary
More than 20 years: Half the salary for every 6 months
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