What is gratuity?

Gratuity is a statutory end-of-service benefit. It recognises long service, so it generally becomes payable once an employee has completed a qualifying period of continuous service with the same employer, and it is paid on resignation, retirement or other exit.

The amount follows a formula set out in the Act, based on last drawn wages and completed years of service. Because the exact figures depend on your inputs, the practical step is to put them into a calculator rather than estimate by hand.