The New Labour Law 2025 has revised gratuity calculations, affecting retirement benefits for employees across sectors. The updated rules provide a transparent and standardized method to determine payouts based on CTC (Cost to Company) and tenure, ensuring fair compensation for long-serving employees.
How Gratuity Is Calculated Under the New Law
The revised formula for gratuity is:
Gratuity = (Last Drawn Salary × 15/26) × Years of Service
Here, the Last Drawn Salary includes basic pay and dearness allowance. The 15/26 factor represents 15 days’ salary for every completed month of service in a year. The law caps the maximum tenure considered at 30 years for payout purposes, ensuring standardized benefits across industries.
Gratuity Payout Example for ₹6 Lakh CTC
An employee earning ₹6 lakh CTC with 10 years of service can expect a gratuity payout of approximately ₹3.46 lakh. This example shows how tenure and salary impact retirement benefits, helping employees plan finances better.
Gratuity Payout Example for ₹12 Lakh CTC
For a ₹12 lakh CTC with 15 years of service, the payout rises to about ₹8.65 lakh. The higher salary and extended service duration significantly increase the retirement benefit, highlighting the advantages of long-term employment.
Gratuity Payout Example for ₹24 Lakh CTC
An employee with ₹24 lakh CTC and 20 years of service may receive a gratuity of approximately ₹23.08 lakh. This demonstrates how senior employees with high CTC can secure substantial retirement benefits under the new law.
Key Features of the Updated Gratuity Rules
The updated rules offer transparency, simplified calculations, and enhanced security for employees. Standardized payout methods allow employees to easily calculate expected gratuity, ensuring that retirement benefits are fair and timely.
Gratuity Calculator Snapshot
| CTC | Years of Service | Approximate Gratuity Payout |
|---|---|---|
| ₹6 Lakh | 10 | ₹3.46 Lakh |
| ₹12 Lakh | 15 | ₹8.65 Lakh |
| ₹24 Lakh | 20 | ₹23.08 Lakh |
How Employees Can Use the Gratuity Calculator
Employees can access official portals or HR-provided tools to input their salary and tenure to estimate gratuity. This ensures that payouts align with the New Labour Law 2025 regulations and allows employees to plan for retirement or long-term financial goals.
Why Understanding Gratuity Matters
Knowing expected gratuity payouts helps employees plan for retirement, investments, and savings strategies. The new law ensures that employees receive accurate, fair, and predictable benefits after years of service.
Conclusion: The New Labour Law 2025 gratuity calculator empowers employees to understand their retirement benefits clearly. With updated calculations based on CTC and tenure, employees can ensure they receive fair payouts while planning for a secure financial future.
Disclaimer: Gratuity payouts are subject to official labour law regulations, tenure verification, and employer compliance. Figures are approximate and may vary based on exact salary components.
