Gratuity Calculator
Fast. Precise. Updated 2025.
Estimated Gratuity
₹ 0
The Formula
Gratuity = (Salary × 15 × Tenure) / 26
Salary Definition
Basic Pay + DA. Note: Under new codes, 'Wages' must be at least 50% of total remuneration.
15/26 Rule
Represents 15 days of wages for every 26 working days in a month.
Tenure
Years of service. >6 months in the final year counts as a full year.
• Regular Employees: 5 years continuous service.
• Fixed Term Employees: 1 year continuous service (New Code).
• Gig/Platform Workers: Now covered under social security.
New Labour Law 2025
Key Changes & Updates
NEW Fixed Term Employees
Gratuity eligibility reduced to 1 year of continuous service (previously 5 years). Benefits now on par with permanent staff.
Gig & Platform Workers
Now formally recognized and covered under social security schemes, funded by aggregators.
Wage Definition
Basic Pay + DA must constitute at least 50% of the total CTC. Allowances cannot exceed 50%.
Tax Exemption
Limit increased to ₹20 Lakhs for private sector employees and ₹25 Lakhs for government employees.
Frequently Asked Questions
The most significant change is for Fixed Term Employees (FTEs), who are now eligible for gratuity after just 1 year of continuous service, reduced from the previous 5-year requirement.
The formula remains (Last Drawn Salary × 15/26 × Years of Service). However,
'Salary' must now include Basic Pay + Dearness Allowance (DA), which must constitute at
least 50% of the total CTC.
No, for regular permanent employees, the 5-year continuous service requirement still applies. The 1-year relaxation is specifically for Fixed Term Employees.
Yes, under the Code on Social Security 2020, gig and platform workers are now covered under social security schemes, which may include gratuity benefits funded by aggregators.