Gratuity claim in India — Code on Social Security ss. 53–56 (old Payment of Gratuity Act) (2026)
First-steps overview when employer gratuity is unpaid or underpaid after exit: Code on Social Security, 2020 Chapter on gratuity in force from 21 November 2025 (old Payment of Gratuity Act, 1972 section numbers kept for search); five-year continuous service rule and death/disablement / fixed-term exceptions; typical formula (15 days’ wages per completed year, ÷26 practice); nomination; apply to employer then competent authority; documents to keep. Educational only — not legal or payroll advice; State rules and establishment coverage matter.
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Which law applies after November 2025
The Code on Social Security, 2020 (SSC) consolidated several social-security statutes, including the Payment of Gratuity Act, 1972. Specified SSC provisions, including the gratuity chapter (Sections 53–58 themes), are in force from 21 November 2025. Older PGA section numbers (for example Section 4 eligibility / Section 7 claim) remain useful for search and for older exits, but live claims should track the Code, Central/State rules, and your establishment’s ‘appropriate Government’. Confirm on the labour department / Shram Suvidha materials that apply to your workplace.
When gratuity becomes payable (Section 53 SSC ≈ old PGA s.4)
Subject to coverage and definitions, gratuity is generally payable on termination of employment after not less than five years’ continuous service — on superannuation, retirement or resignation, death or disablement due to accident or disease, or end of a fixed-term contract, among notified events. The five-year continuous-service condition is not required for death or disablement (and related Code exceptions). Working journalists have a shorter three-year theme under the Code’s journalist proviso. For fixed-term employees, official guidance after the Code’s commencement commonly describes proportionate gratuity after one year of continuous service — verify the exact rule text and any notification that applies to your contract.
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How much — high-level formula
Section 53(2) SSC frames payment at fifteen days’ wages (or such days as notified) for every completed year of service or part exceeding six months, based on last-drawn wages. Piece-rated and other special reckonings follow the Code. In practice many establishments still compute monthly-rated gratuity as (last drawn wages × 15 × years) ÷ 26 — treat that as common payroll practice, not a promise of your exact figure. Ceiling notifications and tax treatment change; this site does not quote a live nationwide tax-free ceiling as advice.
Claim path — employer, then competent authority
Nominate under the Code’s nomination provisions while in service and keep a copy. On exit, apply to the employer in the prescribed form within the time the Central/State rules fix (Central Rules practice commonly discusses about thirty days from the date gratuity becomes payable for the employee, with longer windows for legal heirs — late applications are often not rejected solely for delay if sufficient cause is shown). If the employer rejects, underpays, or stays silent, apply to the competent authority (the successor idea to the old ‘controlling authority’) — Central Rules practice commonly discusses about one hundred eighty days from the cause, again with condonation for sufficient cause. The authority can inquire and direct payment under Section 56 themes. Appeals to the appropriate appellate authority follow the Code/rules.
Documents to keep
Appointment/offer letter, salary slips or bank credits proving last-drawn wages, joining and relieving/resignation/termination letters, full-and-final drafts, PF/UAN and ESI numbers, nomination form, identity and bank details, and a clear service chronology. For death claims, death certificate, heirship/nomination papers, and identity of nominees/heirs.
Practical cautions
Signing a blank full-and-final or a receipt that waives gratuity without understanding the numbers can complicate later recovery. Coverage depends on establishment type and employee definition — not every workplace or every role automatically qualifies. Parallel unpaid-wage claims (Code on Wages) and dismissal challenges (Industrial Relations Code) are separate paths — see those guides.
How Adhiwakta can help
We do not calculate gratuity, file Form claims, or appear before the competent authority. Adhiwakta is a facilitation platform, not a law firm. We do not file cases, appear before any authority, or promise any result. Use Ask Adhiwakta to describe your situation for general guidance from an independent advocate, or start with the AI helper to organise your facts and papers. Educational only — not formal legal advice.
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Frequently asked questions
- Which law governs gratuity after November 2025?
- The Code on Social Security, 2020 gratuity provisions (Sections 53–58 themes) are in force from 21 November 2025, replacing the Payment of Gratuity Act, 1972 framework. Old PGA numbers remain useful for search; confirm live rules for your establishment.
- Do I need five years’ service?
- Generally yes for resignation/retirement-type exits. Death and disablement (and related Code exceptions) do not require five years. Fixed-term employees have a proportionate / shorter continuous-service theme under the Code — verify the exact rule for your contract.
- What if my employer does not pay?
- Apply to the employer in the prescribed form first. If unpaid or underpaid, apply to the competent authority within the rule-prescribed time (Central Rules practice often discusses about 180 days from the cause, with condonation for sufficient cause).
- How is gratuity usually calculated?
- The Code frames fifteen days’ wages per completed year (or part over six months) on last-drawn wages. Many payrolls still use (wages × 15 × years) ÷ 26 for monthly-rated staff — confirm your exact figure from records; this site does not calculate dues.
- Does Adhiwakta recover gratuity?
- No. We do not file claims or appear before the competent authority. Use Ask Adhiwakta or the AI helper for general educational guidance only.
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