What are the labour codes?

The labour codes are four central laws that took the place of a long list of older labour Acts. The one that matters for gratuity is the Code on Social Security, 2020. The Ministry of Labour FAQ of 16 March 2026 and the Lok Sabha reply of 20 July 2026 both date the codes from 21 November 2025. Central Rules were notified on 8 May 2026. PIB published a note on 22 November 2025, the day after that in-force date, describing what the Code does to gratuity and to wages. The note does not itself print “21 November 2025”.

Section 53 of the Code on Social Security, 2020 is the gratuity provision PIB quotes. Two changes are stated in plain words. The eligibility for a fixed-term employee moves from 5 years to 1 year. Once that year of continuous service is complete, gratuity applies on a proportionate basis. And wages include basic pay, dearness allowance and retaining allowance. If payments such as bonus, house rent allowance, conveyance, overtime and commission exceed 50% of total remuneration, the excess is added into wages. Section 2(y) of the Code on Wages, 2019 is the same half-pay rule, read with the Code.

For someone leaving on or after 21 November 2025, the ministry FAQ says gratuity uses last-drawn wages for the entire service. You do not calculate a piece for the years before that date on an older wage and a piece after it on the new wage. The 15/26 factor is unchanged. A part of a year still counts only when it is more than 6 months.

What did not flip on that date

The ceiling did not become a new rupee figure. It remains ₹20,00,000, notified by S.O. 1420(E) dated 29 March 2018. Section 4(3) of the 1972 Act already left the ceiling to a notification, and the Code does the same. Forfeiture for wilful damage, for violent or disorderly conduct, and for an offence involving moral turpitude in the course of employment, is still section 4(6) of the Act as the ministry publishes it. The March 2026 FAQ does not restate those grounds and does not say they have been repealed. Nomination is still Form F in the 1972 Central Rules. Late payment still draws simple interest at 10% a year under S.O. 874(E) dated 1 October 1987, inside the 30-day rule in section 7.

The gratuity guide is the full reading, including who is covered and how to claim. The gratuity calculator applies the formula, the one-year fixed-term test and the 50% add-back. The in-hand salary calculator is the monthly pay before any of this is due. Checked on 2 November 2026.

Mistakes

• Dating the codes from the PIB headline alone. Use the FAQ and the Lok Sabha reply for 21 November 2025.
• Splitting gratuity at that date into two wage rates.
• Announcing a ceiling above ₹20,00,000 because the Code was notified. The notification of the amount is still the 2018 order.