Payment of Gratuity Act, 1972 is an Indian law that makes certain industries pay a one-time gratuity to retired employees. The law applies to railways, ports, factories, oilfields, plantations, mines and shops. The gratuity is 15 days’ wages for every year of employee service, or partial year over six months.
Payment of gratuity: Eligibility and calculation
Under Section 4, payment of gratuity is mandatory. Gratuity shall be payable to an employee on termination of employment after he has rendered continuous service for not less than five years in a single organisation.