Gratuity & End-of-Service Benefits Calculator

Under the Industrial and Commercial Employment (Standing Orders) Ordinance, 1968, an employee who has completed at least 12 continuous months of service is entitled to gratuity equivalent to 30 days of last drawn basic wages for every completed year of service. Any service period exceeding 6 months in a year is legally rounded up to one full year. The calculation strictly uses the basic wage rate, excluding non-permanent allowances.

Under the Indian Payment of Gratuity Act 1972, the formula is: Gratuity = (15 × Last Drawn Salary × Tenure) / 26. The divisor 26 represents the number of working days in a month (30 calendar days minus 4 weekly Sundays), established by the Supreme Court of India in the landmark Digvijay Woollen Mills case. This calculation yields a higher daily wage rate compared to dividing by 30 days. The statutory tax-free exemption limit is ₹20,00,000.

Under Federal Decree-Law No. 33 of 2021, full-time employees completing at least one year of continuous service receive: 21 days of basic salary for each year of the first five years of service, and 30 days of basic salary for each additional year beyond five years. The law eliminated the previous distinction between resignation and termination, ensuring full gratuity is paid regardless of exit reason, provided the total payout does not exceed two years' basic salary.

Under Saudi Labor Law Article 84, base severance is half a month's wage per year for the first 5 years, plus one full month's wage per year thereafter. Under Article 85, if the employee resigns voluntarily: service under 2 years yields 0% gratuity; service between 2 and 5 years entitles the worker to one-third (1/3) of the award; service between 5 and 10 years entitles two-thirds (2/3); and service of 10 or more years entitles the full 100% award.

Yes. Most labor legislations legally mandate that employers encash any accumulated, unutilized paid annual leaves upon employment separation. Leave encashment is calculated by multiplying the unused leave balance in days by the employee's daily wage rate (usually Basic Salary divided by 30 or 26 days depending on regional labor regulations).