Free Engineering Workbench calculator
Gratuity and leave liability
Estimate gratuity payable on exit and leave encashment liability for an employee.
People & organisationHow it's worked out
- Gratuity = 15 ÷ 26 × monthly wages × completed years (part year over six months counts), up to the ceiling
- Wages = basic + DA; if excluded allowances exceed half of total pay, the excess is added (Code on Social Security, 2020)
NoteThe service condition does not apply on death or disablement. Leave rules depend on your policy and state law. Check with counsel; not legal advice.
Source: Payment of Gratuity Act 1972 s. 4; Code on Social Security 2020 (definition of wages)
Need help acting on this number?
VVnT SeQuor's our services practice helps teams turn this metric into a plan.