Gratuity New Rules 2025 : The Central Government has issued a major clarification regarding the payment of gratuity. The Department of Pension and Pensioners’ Welfare (DoPPW), under the Ministry of Personnel, Public Grievances and Pensions, has stated in its latest order that the maximum gratuity limit of ₹25 lakh will apply only to Central Government civil employees who are covered under the Central Civil Services (Pension) Rules, 2021 or the Central Civil Services (Payment of Gratuity under National Pension System) Rules, 2021.
Gratuity New Rules 2025 : Who These Rules Do Not Apply To
This means that the enhanced gratuity limit will not apply to all institutions or employees. Employees working in Public Sector Undertakings (PSUs), banks, port trusts, the Reserve Bank of India (RBI), autonomous bodies, universities, state governments, or societies will not be eligible for this increased limit.
The Pension Department clarified that it had been receiving multiple RTI applications and references asking whether the ₹25 lakh gratuity limit was also applicable to employees of banks, PSUs, RBI, port trusts, universities, autonomous bodies, and state governments.
Department’s Clarification
The department made it clear that,
“These rules apply only to Central Civil Servants and do not extend to organizations such as societies, banks, port trusts, RBI, PSUs, autonomous bodies, universities, and state governments.”
It further added that for any queries or clarifications related to such institutions, the concerned ministry or department should be contacted.
Government Had Increased the Gratuity Limit
Earlier, on May 30, 2024, the Central Government issued a notification increasing the gratuity limit from ₹20 lakh to ₹25 lakh for central government employees.
This decision became effective from January 1, 2024.
The revision was made when the Dearness Allowance (DA) reached 50% of the basic pay of central government employees. As per existing rules, whenever DA touches 50%, all allowances are increased by 25%.
Following this principle, the government also enhanced the ceiling for retirement gratuity accordingly.
