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Originally Posted by pari.nerurkar  Hello Friends,We have a Group Gratuity Scheme of LIC with life Cover. Wherein we pay premium every year to remew the same.Gratuity amt calculated = Last Drawn Basic x 15/26 x Completed Year Service Now i am in the process of restructuring the Salary from Public Sector Line to MNC style i.e. CTC formsGiven the background my questions are1. Whether Gratuity forms a part of CTC? 2. Is it legal to include Gratuity in CTC? What is the ususal practice3. How do the benefit per employee to be calculated you know if to be shown in CTC.4. How the Gratuity is valued if you want to know the CTC whether it forms a part of the same or not.5. Please also let me know how Mediclaim is to be valued as benefit to employee - whether it forms a part of CTC or not. Please let me know at earliest. You can mail me on  hank youRegardsPari |
Dear,
I have gone through comments of many which has prompted me to contribute my views on this subject .
Before I extend these views I think it is necessary to understand terms used and the logic behind them . We use the term "CTC" means Cost to Company which in other works be called as contractual obligation on part of the employer to an employee to bear every year . If Gratuity is suggested to be part of CTC shall mean that it has to be paid by the employer on cessation of employment . Please examine whether it is realy paid if any employee leave the company before completion of 5 years service . If yes , the debate must stop and we must include Gratuity in CTC but if not you need to review your stand and the position .
In my opinion, Gratuity is deferred payment which accrue only after 5 years of service and is leaglly payable . If this is to be apid only after 5 years , it would be premature to include in CTC ( Annual Head ) .
You may evalute this part and accordingly take or leave as to wish.
Thanks
