New Delhi. The 3 percent increase in Dearness Allowance (DA) for central employees may now also impact the gratuity received at the time of retirement. After increasing DA from 60 percent to 63 percent, there will be a change in the calculation of gratuity along with the last salary of the employees.
This increase is considered effective from July 1, 2026. About 48.54 lakh employees and 68.71 lakh pensioners will benefit from this. Actually, the amount of gratuity is decided on the basis of the employee's last basic salary, dearness allowance and total eligible service period. In such a situation, due to increase in DA, the lump sum amount received at the time of retirement can also increase.
How much benefit is there on basic salary of Rs 80 thousand?
Suppose the last basic salary of an employee is Rs 80,000 and he has completed 33 years of service. According to 60 percent DA, the total amount including his basic salary and DA is Rs 1,28,000. On this basis, gratuity works out to around Rs 21.12 lakh.
At the same time, if DA increases to 63 percent, dearness allowance will become Rs 50,400. With this, the total salary will increase to Rs 1,30,400 and gratuity can increase to around Rs 21.52 lakh. That means in this example the employee will get an additional benefit of approximately Rs 39,600.
All employees will not get equal benefits
However, not every employee will get the same benefit from the increase in DA. Its benefit will depend on his salary, period of employment and the maximum prescribed limit of gratuity. Employees whose gratuity has already reached the limit of Rs 25 lakh cannot get the benefit of additional increase.
In this way, the 3 percent increase in DA can prove to be important not only in terms of monthly salary and pension but also in terms of financial security after retirement.