Gratuity rules for government employees under NPS

The Ministry of Personnel, Public Grievances and Pensions' Department of Pension and Pensioners' Welfare has released a notification on the Central Civil Services (Payment of Gratuity under the National Pension System) Rules, 2021. The Central Civil Services (Implementation of National Pension System) Rules, 2021, will apply to government personnel, including civilian government employees in the Defense Services, who joined on or after January 1, 2004.

Here are some of the key features:

1. Any claim for gratuity will be governed by the provisions of these rules in effect at the time a Government employee retires, is retired, is discharged, is allowed to resign from service, or dies, as applicable.
2. The retirement or death gratuity payable under this regulation shall not exceed Rs 20 lakh in any case.
3. Emoluments will comprise basic pay received by a Government employee immediately before retirement or on the day of death, as well as non-practicing allowance awarded to medical officers in place of private practise, for the purpose of estimating the amount of gratuity due under these regulations.
4. Average emoluments are calculated based on the emoluments received by a Government employee during the last 10 months of his employment. For the purposes of this rule, the dearness allowance payable on the date of retirement or death, as the case may be, will also be considered emoluments.
5. The retirement or death gratuity for a government employee who has completed five years of qualifying service will be one-fourth of his emoluments for each completed six-month term of qualifying service, up to 1612 times his emoluments. It will be paid in the following circumstances:
   1. retires at the age of superannuation, invalidation, or death.
   2. retires, or is about to retire, before reaching the age of superannuation, or
   3. Choosing the Special Voluntary Retirement Scheme, which allows surplus personnel to retire voluntarily; or
   4. Upon retirement, being allowed to be incorporated into a service or post in or under a Corporation or Company entirely or substantially owned or controlled by the Central Government or a State Government, or in or under a body controlled or financed by the Central Government or a State Government.
6. In the event of death, the gratuity will be given to the person or individuals to whom the right to receive the gratuity has been granted through a nomination.
7. Interest shall be paid at the rate and manner applicable to Public Provident Fund amounts in accordance with the instructions issued from time to time in all cases where the payment of gratuity has been authorised later than the date when it becomes due, including cases of retirement other than on superannuation, and it is clearly established that the delay in payment was attributable to administrative reasons or lapses: