Collect this from every employee at induction and refresh it whenever family circumstances change. Where an employee dies without a nomination on file, gratuity is payable to the legal heirs, which means the family must establish succession at the worst possible time. A form completed on day one avoids that entirely.
Gratuity Nomination
Nomination for payment of gratuity
Collect this from every employee at induction and refresh it whenever family circumstances change. Where an employee dies without a nomination on file, gratuity is payable to the legal heirs, which means the family must establish succession at the worst possible time. A form completed on day one avoids that entirely.
[COMPANY NAME] [ADDRESS OF THE ESTABLISHMENT]
Establishment registration: [NUMBER]
To the Employer
I, whose particulars are given below, hereby nominate the person or persons named below to receive the gratuity payable in respect of my employment in the event of my death, and direct that it be paid in the proportions stated.
1. Particulars of the Employee
| Item | Detail |
|---|---|
| Full name | [NAME] |
| [Son / daughter / wife of] | [NAME] |
| Employee identification number | [ID] |
| Designation and department | [DESIGNATION], [DEPARTMENT] |
| Date of birth | [DATE] |
| Date of joining | [DATE] |
| Permanent account number | [PAN] |
| Marital status | [Married / Unmarried] |
| Permanent address | [ADDRESS] |
| Present address | [ADDRESS] |
| Place of work | [LOCATION] |
2. Nominees
Nomination must be made in favour of a member of the family, where the employee has a family. A nomination in favour of a person who is not a family member is void where the employee has a family at the time of nomination.
| # | Name of nominee | Relationship | Date of birth | Full address | Share of gratuity (%) |
|---|---|---|---|---|---|
| 1 | [NAME] | [RELATIONSHIP] | [DATE] | [ADDRESS] | [%] |
| 2 | [NAME] | [RELATIONSHIP] | [DATE] | [ADDRESS] | [%] |
| 3 | [NAME] | [RELATIONSHIP] | [DATE] | [ADDRESS] | [%] |
| 4 | [NAME] | [RELATIONSHIP] | [DATE] | [ADDRESS] | [%] |
| Total | 100% |
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These notes accompany the template and explain the drafting choices, the compliance points and the mistakes most often made with this document. They appear as a final page in the Word file, intended to be deleted before the document is executed.
The single most common failure is not a defective nomination but no nomination at all. Where an employee dies with nothing on file, gratuity is payable to the legal heirs, and the family must establish succession — often a succession certificate — before receiving money they need immediately. Making the form part of the joining pack, and chasing the ones that come back blank, is the whole of the solution.
Where the employee has a family within the statutory meaning, a nomination in favour of anyone outside it is void. Where the employee has no family at the time, a nomination in favour of any person is valid, but it becomes void if the employee subsequently acquires a family. That is why Clause 3.2 exists and why a fresh nomination must be collected on marriage.
The nomination that most often fails is the one made at induction by a single employee and never revisited. Build a trigger into the human resources process: on any change of marital status, on the birth or adoption of a child, and on notification of a nominee’s death, issue the fresh nomination form. An annual reminder to all employees to review their nominations costs nothing.
Shares must total one hundred per cent. A nomination with shares totalling ninety or one hundred and ten leaves the balance to be argued about at the worst time. The employer acknowledgement includes this check for that reason.
Where a nominee is a minor, the amount is dealt with in the manner the law provides, and naming a guardian in the nomination makes the process considerably simpler for the family. Employees frequently leave this blank; prompt for it when the form is received.
Provident fund, employees’ state insurance where applicable, group insurance, and any superannuation arrangement each have their own nomination, and they are not interchangeable. An employee who has nominated for provident fund has not thereby nominated for gratuity. Collect all of them together at induction so the family is not left chasing several employers’ worth of paperwork.
Gratuity is ordinarily payable on the termination of employment after the employee has completed the qualifying period of continuous service. A fixed-term employee is entitled to gratuity in proportion to service without completing that period. On death or disablement, the qualifying period does not apply. Do not apply the general rule to those cases.
Gratuity is calculated on the last drawn wages as the consolidated legislation defines them, which includes basic and dearness allowance and requires that excluded components not exceed half of total remuneration. A salary structured with a small basic understates the gratuity liability, and the statutory computation will produce a larger figure than a payroll system built on the old assumptions.
Where an employee dies in service, gratuity is payable to the nominee, and the family should not have to chase it. Treat it as the highest priority item in the settlement process, ask only for the documents actually required, and pay within the period prescribed. Interest runs on delayed payment.
Record each nomination and each fresh nomination in a register with a serial number, file the originals securely, and return an acknowledged copy to the employee. Where the original cannot be produced years later, the register entry and the employee’s copy are the record.
Nomination forms should be retained for the whole period of employment and for the retention period afterwards. They should not be destroyed on a general document retention schedule, because a claim can arise long after an employee has left.
The prescribed form, the definition of family, and the procedure for nomination and for claims may differ under the rules notified by the State in which the establishment is situated. Confirm the applicable form before adopting this template, and use the prescribed form where one is prescribed.
Reflects Indian law current as of {{DATE OF USE}}. Prescribed forms, eligibility, the wage base for computation and the definition of family all change — have this form and the gratuity computation reviewed by a payroll specialist.
This is a ready-to-use template provided for convenience. Laws and requirements change, and every situation is different — please have it reviewed by a qualified professional (a lawyer, company secretary, or chartered accountant as relevant) before you rely on it.