Normally gratuity is eligible for payment after completion of Five years service.
At the time of appointment whether the employer can set aside a portion of CTC for Gratuity payment (which may accure only after five years)??
From India, Hyderabad
At the time of appointment whether the employer can set aside a portion of CTC for Gratuity payment (which may accure only after five years)??
From India, Hyderabad
Hi, It is completely to the descrition of management to decide whether to include gratuity into CTC or not. So ou can out a side
From India, Hyderabad
69From India, Hyderabad
Dear Colleague,
Although gratuity is payable after completion of5 years but the Employer has to make provision for this liability from day1,(i.e.the day employee joins the establishment) Hence employers generally negotiate CTC inclusive of gratuity amount.Secondly, any employer wants that the employeemust stay with him for long. duration because the costof recruitment is now a days is high. But if employee is job-hopper, this aspects indicates to employer whether the employee will stay for atleast 5 years or more. But as such it is totally management's discretion. as suggested by Bhandhavi.r
From India, Nagpur
Although gratuity is payable after completion of5 years but the Employer has to make provision for this liability from day1,(i.e.the day employee joins the establishment) Hence employers generally negotiate CTC inclusive of gratuity amount.Secondly, any employer wants that the employeemust stay with him for long. duration because the costof recruitment is now a days is high. But if employee is job-hopper, this aspects indicates to employer whether the employee will stay for atleast 5 years or more. But as such it is totally management's discretion. as suggested by Bhandhavi.r
From India, Nagpur
Dear Mr. Srinivas,
Gratuity calculation on CTC is purely depends upon the management. But normally many organization has to calculate on the Basic+DA only, who is having minimum 5 yrs continuous service.
Thank You,
From India, Secunderabad
Gratuity calculation on CTC is purely depends upon the management. But normally many organization has to calculate on the Basic+DA only, who is having minimum 5 yrs continuous service.
Thank You,
From India, Secunderabad
Dear Manmeet,
Gratuity is not as percentage it is (Basic+DA)*15/25*No of Years of Service. The max amount that can be granted is 350000/- and in no: of years of service, period more than 6 months will taken as 1 year
From India, Hyderabad
Gratuity is not as percentage it is (Basic+DA)*15/25*No of Years of Service. The max amount that can be granted is 350000/- and in no: of years of service, period more than 6 months will taken as 1 year
From India, Hyderabad
Let's say your package is 5 lacs. You know that your PF is deducted from your salary. Considering components like performance incentive, gratuity, income tax, and other standard components, when you get your salary slip, you find that there is something missing. A portion of your salary is not documented.
Surprisingly, when you calculate the missing amount, you find that it is equal to 12 times your monthly PF deduction. Hold on a minute here. Relax and unfold your salary slip. Now calculate your monthly gross income. Then annual gross and then try to confirm your CTC. You will find out yourself.
Yes! The PF deduction that shows on your salary slip is the company contribution. Your contribution is not documented on your slip. It is documented no where, not even in the offer letter or the agreement letter.
I have taken help from another blog to answer this question. Thanks to that person too.
<link no longer exists - removed>
From India, Madurai
Surprisingly, when you calculate the missing amount, you find that it is equal to 12 times your monthly PF deduction. Hold on a minute here. Relax and unfold your salary slip. Now calculate your monthly gross income. Then annual gross and then try to confirm your CTC. You will find out yourself.
Yes! The PF deduction that shows on your salary slip is the company contribution. Your contribution is not documented on your slip. It is documented no where, not even in the offer letter or the agreement letter.
I have taken help from another blog to answer this question. Thanks to that person too.
<link no longer exists - removed>
From India, Madurai
hi...
I am sorry for putting my question in a wrong manner...
I wanted to know, if i have to include gratuity in the CTC of an employee,how will i calculate the amount that needs to deducted every month....Will the same formula for calculating the Gratuity be used...
e.g If basic is Rs.10,800
From India, Delhi
I am sorry for putting my question in a wrong manner...
I wanted to know, if i have to include gratuity in the CTC of an employee,how will i calculate the amount that needs to deducted every month....Will the same formula for calculating the Gratuity be used...
e.g If basic is Rs.10,800
From India, Delhi
Dear Manmeet,
The gratuity component depends upon the LIC scheme which you are taking. In organization, it ranges from 4-5.5% of PF base. In my organization, its 4.9%.
Seniors please correct me if i am wrong.
From India, Mumbai
The gratuity component depends upon the LIC scheme which you are taking. In organization, it ranges from 4-5.5% of PF base. In my organization, its 4.9%.
Seniors please correct me if i am wrong.
From India, Mumbai
Community Support and Knowledge-base on business, career and organisational prospects and issues - Register and Log In to CiteHR and post your query, download formats and be part of a fostered community of professionals.
Gratuity-Leave calculation on CTC-Rev..xls
CTC - Variable Component.pdf