Three gratuity formulas apply depending on your employer type: (1) Private + covered under PG Act: 15 days per year, divided by 26 working days. (2) Private + NOT covered: 15 days per year, divided by 30 days. (3) Govt / CCS rules: 1/4 of basic+DA per year of service. The calculator picks the right one based on your employer type toggle and shows the formula breakdown so you can verify.
When to use this
Use to: understand exactly how your gratuity is computed (the HR formula isn't always intuitive), check whether your employer is covered under PG Act (10+ employees rule), reconcile your final settlement against the formula, compute gratuity for past employers you've worked at.
Frequently Asked Questions
Is my employer covered under the PG Act?
Yes if they had 10+ employees on any day in the past 12 months. Once covered, they stay covered even if headcount drops below 10. So most established companies in India are covered. Small startups (under 10 employees) may not be - and in that case the 15/30 formula applies (lower gratuity).
Does the formula use last drawn salary or average?
Last drawn (most recent basic + DA on the date you leave). This is good news - your gratuity reflects your final salary, not an average over 5 years. Increments in your last year boost your gratuity significantly.
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