7th Pay Commission: Government employees got a big gift, after DA, a big update came on Gratuity..

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The Modi government at the Center has given great news to the government employees. After the increase in DA (Dearness Allowance Hike), now it has decided to increase the Gratuity Hike. This will benefit lakhs of central government employees.


After increasing the dearness allowance by 4 percent before the Lok Sabha elections, the central government has now increased the amount of retirement gratuity update and death gratuity by 25 percent. With this, the limit of gratuity has increased from Rs 20 lakh to Rs 25 lakh. This increase will be considered effective from January 1, 2024.

Now this increase in gratuity
According to the Office Circular (OM) issued by the Central Government on 30 May 2024, retirement gratuity and death gratuity are being increased by 25 percent as per the recommendations of the 7th Pay Commission Update and the Central Civil Services Rules, 2021. Now central employees will get a gratuity of Rs 25 lakh (gratuity hike news). Earlier, the decision to increase gratuity was taken on 30 April. But it was stopped by issuing a circular on 7 May.

DA was increased in March
The central government had increased the DA of central employees by 4 percent in March 2024. It was announced to implement the increased DA from January 1, 2024. Due to the increase in Dearness Allowance and Dearness Relief, lakhs of employees and pensioners got relief. Following this decision of the central government (DA hike update), many state governments also increased the DA of their employees before the elections.

What is gratuity?
Gratuity is a special amount, which the company gives to its employees. According to the Gratuity Payment Act 1972, when an employee works in the same institution for five years, he is entitled to gratuity (Gratuity kya hai?). Government and private employees get the benefit of this scheme. The gratuity amount is given only on the termination of service, death, or resignation of the employee. If any company (7th pay commission news) has 10 or more employees, then it has to give the benefit of gratuity to its employees. This rule applies to companies as well as shops, showrooms, factories, and mines.


The amount received on gratuity is tax-free
The amount received on gratuity is tax-free. If the employee dies while working in the company (Tax-free gratuity), then the gratuity amount is given to the nominee. The 5-year rule does not apply here. The gratuity amount is calculated based on 15 days' salary of the last month. Its formula is Gratuity = (n*b*15)/26. Here n means the number of years the employee has worked in the company. b means the last salary received by the employee (central government employees), which includes DA and commission.

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