Gratuity is a lump sum amount paid by an employer to an employee as a token of appreciation for their past services. It is a vital part of your retirement or resignation settlement.
Eligibility
In most jurisdictions (like India), an employee becomes eligible for gratuity only after completing a minimum of 5 years of continuous service with the same employer.
The Calculation Formula
The standard formula is usually based on your last drawn basic salary and your total years of service. For example: (15 * Last Drawn Salary * Years of Service) / 26.
Calculating this manually can be confusing, especially with partial years. To get an accurate estimate of your payout, use our Gratuity Calculator.