Simple HR for MSMEs in Siruseri, Sriperumbudur, Oragadam and more

How much gratuity does a company in Tamil Nadu have to provide for?

Enough to pay 15 days of wages for every completed year of service for every employee who will cross five years. For a growing company that number gets large quietly, because it is driven by the basic pay of long serving people rather than by headcount.

Since 21 November 2025 there is a second check on the wage base. Where allowances excluded from wages exceed half of total remuneration, the excess is added back. A salary structure that kept basic pay thin to hold the liability down no longer does so.

gratuity calculator

What does the Shops and Establishments Act require of a Tamil Nadu employer?

Registration with the state labour department, usually within a window of starting business that the state sets, often around thirty days. From there the Act governs daily and weekly working hours, the weekly off, breaks, opening and closing times, leave and holidays, and the records to be kept.

Because every state has its own Act, a rule of thumb carried from another state can quietly be wrong. The shape is similar everywhere. The numbers are not.

what the Shops and Establishments Act covers

What should an offer letter in Tamil Nadu actually contain?

There is no statutory format for an offer letter in India, which is exactly why so many of them are thin. A usable one names the legal entity making the offer, the job title, the reporting line, the work location, the date of joining, the gross annual salary with its components set out separately, the probation length, the notice period on both sides, and a date by which the candidate has to respond. Leave any of those out and the argument happens later, usually at exit.

The component split matters more than the headline number. Basic pay drives provident fund, gratuity and leave encashment, so a letter that shows only a single annual figure tells the candidate nothing about take home pay. Offrd builds the letter from the salary structure you set up once, so the breakup in the offer, the appointment letter and the first payslip are the same numbers.

offer letter generator

What state level deductions sit outside provident fund and insurance?

Professional tax, where the state levies it, capped at 2,500 rupees a year by Article 276 of the Constitution. The labour welfare fund contribution, where the state runs one. Both are small, both are state specific, and both are easy to miss when a company opens its first office outside its home state.

Neither is difficult once it is on the calendar. The failure mode is not complexity, it is forgetting that the rule changed at the border.

professional tax explained

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