Gratuity Act
Payment of Gratuity Act, 1972 Compliance
Honor your employees' service with accurate gratuity payments, manage your liability effectively, and ensure full legal compliance.
Introduction and Value Proposition
The Payment of Gratuity Act rewards long-term service by providing a financial token to employees upon retirement, resignation, or superannuation after five years of continuous service. While a valued benefit, calculating the correct amount, understanding continuous service, and adhering to strict timelines is complex and prone to error. Mistakes can lead to employee disputes and penalties. PCS provides expert gratuity advisory and calculation services, ensuring accurate payouts, s
Why Choose PCS?
● Calculation Precision: We ensure every calculation is accurate, protecting you from financial loss and disputes.
● Deadline Management: We help you process payments within the mandatory 30-day window to avoid interest penalties.
● Strategic Advisory: We provide advice beyond compliance, helping you structure your gratuity liability for financial efficiency.
Key Challenges We Solve
● Complex Calculations: Difficulty in accurately calculating the gratuity amount based on last drawn wages and years of service.
● Eligibility Disputes: Confusion over what constitutes “continuous service” and which employees are eligible.
● Timely Payment: Risk of missing the strict 30-day payment deadline after the application is received, attracting interest penalties.
● Liability Management: Challenges in planning for and funding this significant financial liability.
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Frequently asked questions:
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What is the time limit for paying gratuity?
Gratuity must be paid within 30 days from the date it becomes payable. Failure to do so will require the employer to pay interest on the amount.
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Is gratuity payable to an employee who is terminated for misconduct?
Gratuity can be forfeited if an employee's services are terminated for proven acts of violence or misconduct.
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What is the maximum gratuity amount payable?
The maximum amount is ₹20 lakhs. Any amount above this is ex-gratia.
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