Labour & Service Law
Gratuity
A lump-sum payment an employer is required to make to an employee on retirement, resignation, or termination, after a minimum period of continuous service.
Gratuity is meant to reward long service, and becomes payable once an employee completes the minimum qualifying period, calculated based on their last drawn salary and years of service, subject to a statutory ceiling.
An employer failing to pay gratuity when due can be directed to pay it, along with interest, through the mechanism set out under the applicable gratuity law.
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