7th Pay Commission : Central govt employees to get up to Rs 7 lakh higher gratuity

7th Pay Commission : Central govt employees to get up to Rs 7 lakh higher gratuity



7th Pay Commission : Central govt employees to get up to Rs 7 lakh higher gratuity

Central government employees, who have retired in 2021, are getting a bigger amount of gratuity and leave cash payment compared to their senior colleagues, whose service tenure ended in 2020


New Delhi : The Central Government recently revised the percentage of Dearness Allowance (DA) to be considered for calculation of Gratuity and Leave Encashment of Central Government Employees who retired between 1st January 2020 and 30th July 2021.

The breakup of the additional 11% DA that was announced in July is 4% for January 2020 to June 30 2020, 4% for July to December 31, 2020 and 3% for January to June 30, 2021. As per the rules mentioned in the Central Civil Services (Pension) Rules, 1972, the DA on the date of retirement or death of the employee is reckoned as emoluments for the purpose of calculation of gratuity. 

Based on the rules, the national percentage of DA for the calculation of gratuity and leave encashment has been announced. As per the Office Memorandum (OM) issued by the Department of Expenditure, retirement benefits of these employees will be calculated as follows :

For employees retired during January 1, 2020, to June 30, 2020, the applicable DA rate is 21%-- 17% plus 4% for the period January 1, 2020 to June 30, 2020.

For employees retired during July 1, 2020, to December 31, 2020, the applicable DA rate is 24%-- 17% plus 4% for the period January 1, 2020 to June 30, 2020 and 4% for July 1 to December 31, 2020.

For employees retired during January 1, 2021, to June 30, 2021, the applicable DA rate is 28%-- 17% plus 4% for the period January 1, 2020 to June 30, 2020, 4% for July 1 to December 31, 2020 and 3% for January 1 to June 30 2021.


Up to Rs 7 lakh increase in Gratuity :


HS Tiwari, Former President of AG Office Brotherhood, Prayagraj, which calculates DA, was quoted in a Jagran report saying that if the basic salary of an employee is Rs 40,000 rupees at the time of retirement, then they will be benefited hugely from the 11 per cent increase in dearness allowance (DA). 

The amount of their gratuity and Leave Encashment will increase by about Rs 1,17,000. On the other hand, if the basic pay is Rs 2,50,000 per month, the retirement fund will increase by more than Rs 7 lakh.

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