A demand to increase the maximum gratuity of Central Government employees from ₹25 lakh to ₹75 lakh is again getting attention during the ongoing 8th Central Pay Commission process.
The proposal has come from the NC-JCM Staff Side, which submitted its memorandum to the 8th CPC in April 2026. It is important to understand that ₹75 lakh gratuity has not been approved. It is only a demand placed before the Commission.
What is the current gratuity limit?
At present, the maximum Retirement Gratuity and Death Gratuity limit for eligible Central Government employees is ₹25 lakh.
The Government increased this limit from ₹20 lakh to ₹25 lakh with effect from 1 January 2024, after Dearness Allowance reached 50%.
So the present official position is:
Current maximum gratuity: ₹25 lakh
What has NC-JCM demanded from the 8th CPC?
NC-JCM Staff Side has proposed three major changes in gratuity rules:
Increase the maximum gratuity ceiling from ₹25 lakh to ₹75 lakh.
Calculate gratuity using 25 effective working days instead of 30 days.
Remove the existing ceiling of 16.5 times the employee’s emoluments.
The organisation has also proposed that gratuity should be calculated at half a month’s Basic Pay plus Dearness Allowance for every completed six-month period of qualifying service.
Why is the 25-day formula being demanded?
NC-JCM argues that Central Government employees should not be placed at a disadvantage compared with employees covered under other gratuity provisions.
For this reason, it wants gratuity calculations to consider 25 effective working days in a month instead of 30 days.
If accepted, this proposal could increase the gratuity payable to eligible long-serving employees.
However, the final financial impact would depend on the formula eventually recommended by the 8th CPC and accepted by the Government.
Why does NC-JCM want the 16.5-times ceiling removed?
Under the present system, retirement gratuity is subject to an upper limit linked to an employee’s emoluments.
NC-JCM says this limit can restrict the benefit of employees who have completed long years of service. It has therefore asked the 8th CPC to remove the 16.5-times emoluments ceiling.
Is ₹75 lakh gratuity already approved?
No.
This is the most important clarification.
The ₹75 lakh figure is a proposal submitted by an employee organisation. The 8th Central Pay Commission has not announced any final gratuity ceiling, and the Government has not approved ₹75 lakh gratuity.
The official 8th CPC website shows that the Commission is still carrying out consultations and visits.
Therefore:
₹25 lakh = Current official limit
₹75 lakh = NC-JCM demand
Is there any other gratuity proposal before the 8th CPC?
Yes.
The Indian Railways Technical Supervisors’ Association (IRTSA) has made a separate proposal.
IRTSA has suggested:
- retirement gratuity at one-third of Basic Pay + DA for each completed six-month period;
- up to 32 times Basic Pay + DA for employees with 33 years or more qualifying service;
- a maximum gratuity ceiling of ₹50 lakh.
This means different employee organisations have proposed different gratuity formulas.
NC-JCM: ₹75 lakh ceiling
IRTSA: ₹50 lakh ceiling
Neither proposal has been approved so far.
Why is this issue important for Central Government employees?
Gratuity is an important retirement benefit linked to an employee’s pay and length of qualifying service.
A higher ceiling and a revised formula could particularly benefit employees retiring after long service and those drawing higher Basic Pay and DA.
But employees should not calculate their retirement benefits on the assumption that ₹75 lakh has already become the new limit.
Any change will become effective only after the 8th CPC makes its recommendations and the Government formally accepts and notifies the change.
What should employees remember?
The ₹75 lakh gratuity proposal is genuine, but it is not a new Government order.
NC-JCM submitted the demand to the 8th CPC in April 2026, and the subject has again entered public discussion during the Commission’s ongoing consultation process. The present official gratuity ceiling remains ₹25 lakh.
Sources
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