7th Pay Commission: Gratuity and Pension are two such payments that everyone should have a clear hand about. It may be clear to an employee during the time of his employment period, but are not to the members of his or her family. Therefore, rationalisation of the gratuity is important to know for both the government employees and its family members.
Reportedly, as per the 7th Pay Commission recommendations, if a government employee dies in less than one year of his or her services, the rate of death gratuity is two times his or her monthly salary.
This money would increase to six-time if the government employee has died in the service period of more than one but less than five years of services.
Currently, the Central government employees with five or more years of service are eligible for tax-free gratuity after leaving the job.
What are the benefits of Gratuity under the 7th Pay Commission?
Central employees get a monetary benefit of gratuity. However, this benefit is not available every month. The provisions and rules of gratuity for government and private sector employees fall under the Payment of Gratuity Act, 1972. Gratuity benefits are available for an employee who gets retired or have worked minimum of 4 years, 10 months, 11 days at one company and on sickness/divisiveness or illness during their service tenure.
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