Employees of the Central government who have received gratuity on retirement will not be eligible for gratuity again if they are re-employed within the government. Simply put, once retirement gratuity is received from the government, the Central government employee cannot claim gratuity a second time if they take up a job again in the same system.
The rule, however, is different for public-sector unit or PSU employees who get re-employed. They can claim gratuity for their service from the PSU as well as from the Central government on re-employment. However, there is a limit to this. The total gratuity from both the sources (the PSU as well as the Central government assignment) cannot exceed what the employee would have received had they been in the continuous service of the Central government for their whole tenure. The same rule is applicable to those retiring from a state government job and getting re-employed with the Central government.
When it comes to those who have served the military and then get re-employed with the government, they will be eligible for full gratuity from the military as well as from the civil service, without any deductions or cap.
An office memorandum (OM) has been issued by the Department of Pension and Pensioners’ Welfare under the Ministry of Personnel, Public Grievances and Pensions of the Central Government explaining rule 4A of the Central Civil Services (Payment of Gratuity National Pension System) Amendment Rules, 2025 and clarifying the gratuity payment in case of re-employment.
