New Gratuity Rule: 1 Year Service Now Qualifies for Gratuity, Benefits Private Sector

• Central government implements new labor code, reducing gratuity eligibility from five years to one year.
• Private sector employees, especially fixed-term and contract workers, will significantly benefit from this change.
• Gratuity calculation now includes basic salary, dearness allowance, and retaining allowance; excludes bonus, HRA, PF, and travel allowance.
• The formula for calculating gratuity is: (Last month's salary) × (15/26) × (Completed years of service).
• Companies must pay gratuity within 30 days of service termination; minimum 12 months of service required.