Gratuity is a statutory payment, not a discretionary bonus. The Payment of Gratuity Act, 1972 governs it for establishments with ten or more employees.
Who qualifies
Gratuity is payable on leaving employment after five years of continuous service, whether you resign, retire or are terminated. The five year requirement does not apply where employment ends due to death or disablement. Continuous service has a statutory meaning that accommodates authorised leave and certain interruptions, so do not assume a short break disqualifies you without checking.
How much
The standard formula is fifteen days' wages for every completed year of service, computed as last drawn wages multiplied by 15/26 multiplied by completed years, with a completed year generally including service beyond six months in the final year. Wages here means basic plus dearness allowance. The statutory ceiling on gratuity has been revised over time and currently sits at twenty lakh rupees for covered private sector employees.
When it must be paid
The employer must pay gratuity within thirty days of it becoming due. Delay attracts interest. An employer cannot withhold gratuity simply because of a pending dispute or a notice period disagreement. Forfeiture is possible only in the narrow circumstances Section 4(6) allows, essentially termination for certain kinds of misconduct, and even then only to the extent the law permits and with proper process.
If it is not paid
The route is a claim before the Controlling Authority under the Act, which is a purpose-built forum for exactly this. A formal demand with the computation attached is the sensible first step, and many employers pay at that stage rather than face the authority.
This article is general information, not legal advice, and does not create a lawyer-client relationship. If your gratuity is unpaid or miscalculated, start the intake and the lawyer will review the numbers.