The Payment of Gratuity Act, 1972

The Payment of Gratuity Act, 1972 is a social welfare legislation that aims to provide financial security to employees in India. It regulates the payment of gratuity to employees engaged in factories, mines, oilfields, plantations, ports, railway companies, shops or other establishments. The Act mandates that an employee who has completed five years of continuous service with an employer is eligible to receive a gratuity payment at the time of retirement, resignation, or death. The gratuity payment is calculated as 15 days' wages for every completed year of service, subject to a maximum amount of Rs. 20 lakhs.