📖 Dictionary
Gratuity Meaning
Defining the Term and Concept
Definition
Gratuity refers to a sum of money paid to an employee at the end of a period of employment. The term comes from the word "gratitude," implying a reward for services rendered.
Legal Context
In employment law, specifically in countries like the UAE, India, and Saudi Arabia, gratuity is not just a voluntary gift but a statutory obligation. It is a defined benefit plan where the employer provides a lump sum based on the employee's salary and years of service.
Synonyms
- End of Service Benefits (EOSB)
- Severance Pay (though slightly different in some contexts)
- Service Award