New NPS Gratuity Rules 2025: Eligibility Criteria for 2nd Gratuity Explained

The Central Government has revised gratuity guidelines for National Pension System (NPS) subscribers via a memorandum dated December 26, 2025.  

This new rule deals with the eligibility for a second gratuity after re-employment post-retirement, clarifying who qualifies and who does not. 

Gratuity Treated as a One-Time Terminal Benefit 

According to Rule 4A of the Central Civil Services (Payment of Gratuity under NPS) Amendment Rules, 2025, gratuity is considered a one-time terminal benefit.  

Therefore, any government employee covered under NPS who has already received gratuity upon retirement will not receive it again if re-employed.  

This applies regardless of the type of gratuity drawn, be it superannuation, compulsory retirement gratuity or compassionate gratuity. 

Exceptions Provided Under the Revised Rules 

Certain exceptions have been made. Employees who initially served in a Public Sector Undertaking (PSU) or autonomous body and then joined Central Government service with proper permissions may be granted gratuity for their government service as well.  

However, the total amount will be limited to what the employee would have received if the entire service tenure was completed under Central Government employment. 

Read More: 8th CPC, DA Hikes and Pension Reforms: 10 Big Changes for Central Govt Employees in 2025! 

Provision for Combined State and Central Service 

In cases where an employee draws gratuity for services rendered under both State and Central Governments separately, the combined gratuity amount must not exceed the total gratuity amount that would be allowed had the service continued without interruption within the government system based on the final pay drawn. 

Guidelines for Ex-Servicemen in Civil Roles 

Ex-servicemen occupying civil posts post-retirement are eligible to receive gratuity for their civil service tenure. Previous gratuity benefits drawn during military service will not affect or restrict the calculation of gratuity applicable on the civil post tenure.  

This clarification has been issued in consultation with the Department of Expenditure and the Comptroller and Auditor General of India. 

Conclusion 

The NPS gratuity rules introduced in 2025 reinforce the principle of gratuity as a one-time terminal benefit while laying out specific exceptions for PSU transitions and ex-servicemen. Ministries and departments have been directed to ensure strict adherence to these updated provisions. 

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