Gratuity Bill amendment to be tabled in Lok Sabha on 5th March 2018

Government will table the The Payment of Gratuity (Amendment) Bill 2017 in Lok Sabha on 5th March 2018.

The bill is to amend the Payment of Gratuity Act 1972. The bill is to increase gratuity ceiling from existing Rs.10 lacs to Rs.20 lacs. Union Cabinet has given its node for the amended bill on 12th September 2017.

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Gratuity ceiling will increase from Rs.10 lacs to Rs.20 lacs once the bill is passed in Lok Sabha and then subsequently in Rajya Sabha.

“The amendment will put the maximum limit of gratuity of employees of the private sector as well as public undertakings and autonomous organisations under the government who are not covered under Central Civil Services (Pension) Rules, at par with central government employees, which is ₹20 lakh,” an official release said. Before implementation of the 7th Central Pay Commission, the ceiling under Civil Services (Pension) Rules, 1972, was ₹10 lakh.

Considering inflation and wage increase even in the case of employees engaged in the private sector, the government is of the view that the entitlement of gratuity should be revised for employees who are covered under the Payment of Gratuity Act, 1972, which applies to establishments employing 10 or more persons, an official release said.