Gratuity and Bonus — Prelims Strategy

Prelims Strategy

For Prelims, a strong grasp of factual details is paramount. Begin by thoroughly understanding the core provisions of the Payment of Gratuity Act, 1972, and the Payment of Bonus Act, 1965. Focus on specific numbers: minimum service years (5 for gratuity, 30 days for bonus), calculation percentages (15/26 for gratuity, 8.

33% minimum for bonus), salary ceilings (INR 20 lakh for gratuity, INR 21,000 eligibility for bonus, INR 7,000 calculation cap for bonus). Memorize key terms like 'continuous service', 'allocable surplus', 'set-on/set-off', and 'forfeiture conditions'.

Pay special attention to exceptions, such as the waiver of the 5-year rule for gratuity in cases of death/disablement, and the pro-rata gratuity for fixed-term employees under the Code on Social Security, 2020.

Practice MCQs that test your understanding of these specific provisions and their application. Create flashcards for quick recall of statutory limits and definitions. Understand the difference between 'wages' for gratuity vs.

bonus calculations. Cross-reference with the Code on Social Security, 2020, to identify which provisions have been retained or modified. A clear, concise mental map of each Act's essentials will be highly beneficial.