Gratuity from last wage and service
The form opens on the guide's example: Rs. 60,000 and 7 years 8 months, counted as 8 years.
The figure your policy or the applicable standing order uses. Often last drawn wages, not an allowance stack you invented.
More than 6 months rounds the year up. Six months or fewer does not.
Illustrative gratuity
- Wage usedRs. 60,000
- Years counted8
- Wage × yearsRs. 480,000
- 1Enter last monthly wage used for gratuity
- 2Add completed years and extra months
- 3More than 6 extra months counts as one more year
- 4Gratuity = wage × years counted
How the years are counted
The common formula is last monthly wage multiplied by years of service, with a remaining period of more than six months counted as a full year. Thirty days' wages at a monthly rate is the same as one month of that wage. The form does that multiplication and nothing else. It does not add leave encashment, notice pay, or tax.
The opening numbers match the gratuity guide: Rs. 60,000, 7 years and 8 months, counted as 8 years, Rs. 480,000. Switch the months to 4 and the years counted stay at 7, which is Rs. 420,000. The rest of an exit payment is the final settlement calculation and the final settlement calculator.
What you still have to check
Standing order practice, a provincial labour code, and a company scheme can disagree. A recognised provident fund often stands in place of statutory gratuity, so paying both can be wrong. This page does not know which statute covers the establishment, and it does not apply an income-tax exemption. Read the guide, then confirm with the statute and the contract before anyone is paid. Payroll that should pull service dates off the employee record is covered on payroll software for Pakistan.
Gratuity calculator questions
Last monthly wage times years counted. A part year of more than six months counts as one more year. Six months or fewer does not. That is the common reading of thirty days' wages per year, which collapses to about one month of wages per year.
Not by itself. The Industrial and Commercial Employment (Standing Orders) Ordinance 1968 is the traditional source, and provinces have their own versions, including the Punjab Labour Code 2026. A qualifying provident fund can replace gratuity. Misconduct and the contract can change it. Confirm before you pay.
No. Those belong in a final settlement. Use the final settlement calculator for pro-rated salary, leave, notice and recoveries, and keep this page for the gratuity line.
Eight months is more than six, so the part year rounds up. The same example in the gratuity guide, at Rs. 60,000, is Rs. 480,000. At 7 years and 4 months the count stays 7 and the amount is Rs. 420,000.
Run this in live payroll, not a spreadsheet
StreamHCM applies the same FBR slabs, attendance rules, EOBI and expense-claim logic across every employee, then generates the payslip.