Salary -- is the amount which is paid to an employee for his service.
Govt has made few rules on salary . Like Min. Wages Act,etc.
Few Components in Salary.
Basic --Min amount paid to an employee .
DA(Dearness Allowance)-allowance paid to employee with basic.
HRA(House Rent Allowance)-which is given as allowance.
LTA(Leave Travel Allowance)-
Employer PF-Which is an indirect monthly payment to employee credited to his PF account for his future benifits(not a part of salary as per PF act)
CEA(Children Educational Allowance)
These are few things which are in salary earnings.
PF(Provident Fund)-12% on basic
PT( Professional Tax as per state)
ESI(Employee state Insurance)
Hope this will hep you.
for reducing the tax, you need to refer to your country Labor Law, or any other regulation implemented in Europe, I think for the size & sector of the business define the salary ranges, in average for London ranges it's from $ 9,000 - $ 70,000 for SME, taking into consideration the number of grades and the overlapping when designing your structure.
for further information kindly contact me on my email: -
Eng. Muhammad Abuissa
let say your grades are ( 1, 2, 3,....10)
Then The basic salary is to be Overlapped ( which is the best practice in grading system)
Grade 1 = Basic 1000 $ to 2500$
Grade 2 = Basic 2300& to 3500$
Grade 3 = Basic 3200$ to 5000$
The from to will set for you three points of the salary; Minimum, Mid, & Maximum.
Attached file for your reference definition of position and grade2007 a.xls
Hope this will help you