An ex gratia payment is an amount of money that an employee would receive by the employer as a termination payment when he/she has left the company.
It usually represents a “good will” sum without any obligation by the employer to pay this.
Are CPF contributions payable on gratuity and ex-gratia payments?
CPF contributions are payable on ex-gratia payments that are given in respect of your employee’s employment. For example:
reward your employee's good performance
reward your employee for the completion of a contract/project
entice your employee to remain in employment OR
recognize your employee's service
NOTE: CPF contributions are not payable on the ex-gratia payments if they are compensations given for termination or loss of employment.