The Act is applicable, to factories, mines, oil fields, plantations, ports, railways, motor transport undertakings, companies, and to shops and other establishments, Employing 10 or more workmen. The Act provides for payment of gratuity at the rate of 15 days wage s for each completed year of service subject to a maximum of Rs. ten lakh. In the case of seasonal establishment, gratuity is payable at the rate of seven days wages for each season. The Act does not affect the right of an employee ... Are employees not covered under the Gratuity Act eligible for gratuity ? Yes, employees not covered by the Gratuity Act may still receive gratuity , calculated using: Gratuity = Average salary (basic + DA) x ½ x Number of years of service. A comprehensive guide to gratuity in India for 2025, covering eligibility criteria, calculation methods for covered and non-covered employees, and crucial tax implications under Section 10(10) and the New Tax Regime. Gratuity is governed by the Payment of Gratuity Act, 1972 and applies to both government and private sector employees who meet the eligibility criteria. It is calculated based on the last drawn salary and the number of years served.
