Good News For UP Teachers: Gratuity Limit Likely To Rise To ₹25 Lakh, 2.5 Lakh Staff To Benefit

Teachers and non-teaching staff working in aided and council-run secondary schools in Uttar Pradesh are set to receive a major retirement benefit boost. The state government has agreed in principle to raise the gratuity ceiling for them from ₹20 lakh to ₹25 lakh.

More than 2.5 lakh employees are expected to benefit from the move, bringing their post-retirement benefits closer to those available to regular state government employees.

Gratuity ceiling to match state employees

At present, teachers and staff in these institutions can receive a maximum gratuity of ₹20 lakh. The limit for state government employees was increased to ₹25 lakh on 2 July 2024. Since then, teaching organisations have been demanding parity.

After nearly a year of discussions, the Secondary Education Department has now prepared a formal proposal to extend the same benefit to aided and council-run secondary school teachers and non-teaching personnel. The proposal was sent to the Finance Department last week and is expected to be finalised after high-level approval.

Officials say the change will provide significant financial relief at the time of retirement, as gratuity is one of the primary lump-sum benefits employees depend on after completing their service.

Proposal prepared by Secondary Education Department

The department has drafted the plan to increase the maximum gratuity to ₹25 lakh for teachers and non-teaching staff in recognised aided secondary schools on the same lines as state employees. Once cleared, the revised limit will apply to more than 2.5 lakh working personnel across the state.

Currently, their gratuity payout remains capped at ₹20 lakh. With the proposed revision, retirees will receive a higher terminal benefit, strengthening financial security after service.

Gratuity possible even after one year for some employees

Alongside the state proposal, changes in central labour rules will also make gratuity accessible faster for certain categories of workers. Earlier, an employee generally had to complete at least five continuous years of service to qualify for gratuity.

Under the new provisions, fixed-term employees can receive gratuity after only one year of service. A fixed-term employee is someone hired under a contract with a specified end date, such as one- or two-year employment agreements.

If such an employee works for at least 240 days, gratuity will be paid on a pro-rata basis when the contract ends, even if five years of service are not completed.

Social security benefits widened

The change primarily aims to extend social security coverage to contract-based workers who earlier missed out on retirement benefits. They will now be able to receive gratuity on leaving employment, similar to regular staff.

However, the five-year continuous service condition will continue to apply to permanent employees.