Government has released the notification for payment of revised gratuity amounting Rs Twenty Lakhs to bankers since 29th March 2018.
Important Points
1. The ministry of labor and employment vide gazette notification dated 29th March 2018 has raised the ceiling on the amount of gratuity payment under section 4 of the Payment of Gratuity Act, 1972 from existing Rs 10 lakhs to Rs 20 Lakhs.
2. Maternity Clause - Further while making payment to gratuity, the central government specifies as per section 2A of Payment of Gratuity act, 1972 that the total period of maternity leave in case of female employee shall not exceed twenty six weeks.
The formula of calculating the gratuity is very simple i.e. multiple of Basic pay along with dearness allowance and length of service with 15 and divisible to 26 i.e. the actual working days in month.
Gratuity = BP X Dearness Allowance X length of Service X 15 / 26
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Gratuity