Industrial Relations
Recruitment/talent Acquisition, Career Counselling
Marketing Exec
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Hello friends....this is my 1st post and good to see many people interacting here.
I have a query.
I wanted to know if the fixed and variable payout is shown in the payslip.
Also, in the offer letter given to my friend, it is clearly metioned that 3 lakhs will be the fixed CTC and 2 lakhs will be the variable payout per annum. Now his payslip contains only 3 lakhs sutucture , but his offer letter shows (5 lakhs CTC)- fixed:3lakhs + 2 lakhs variable.
Now the issue is: he got another offer from a company and he said to them that his pay us 5 lakhs where as in bank stment and payslip its showing just 3 lakhs. How should he convince for 2 variale pay he got...which was given to him in the form of cash.
Please post the payslips in which variable component is shown & if any one has been through this kind of issue...please post your offer letter(fixed +variable) so that I can see if other companies also do these kinds of things.

From India, Hyderabad
No where the variable pay is paid along with salary and mentioned in the pay slip.
The offer letter itsel is a proof and most of the companies will issue a pay note after depositing in the bank, if the company has given the amount in cash then you have submit the copy of the voucher or else form 16 can be submitted.
you firend should tell in the interviews about the fixed and variable pay in the begining itself and should also tell about the cash payment part also. I suggest that he should request for the variable pay amount through bank otherwise he will be facing income tax issue also.
Regards - kamesh

From India, Hyderabad
How a company can pay cash? Is it not reflected in Form 16? Is it not attract I.Tax? Variable pay is mentioned in Payslips. Pon
From India, Lucknow
Hello talla.shekar,
Going by the inputs you mentioned, I think the Company where your friend is presently working is EITHER WILLFULLY OR BY MISTAKE mixing up the 'variable pay' aspect of the salary [that many companies offer now-a-days] AND salary payment BY CASH. The former is an official & formal part of the salary & payslips, while the later is a means to avoid Tax--by the Company--which situation consequently gets passed-on to the employee [whether he/she likes it or not].
Salary by cash [partially or fully] is usually practiced by the typical Bania companies, where the accounting practices aren't professional & leave a lot to be desired [if you get what I mean].
Coming to the current situation of your friend, like kamesh mentioned, ask him to mention the facts in the interviews. Since you haven't mentioned the domain/sector, it's tough to give any opinion if the 40% Variable salary structure is normal or abnormal/fishy.

From India, Hyderabad
Dear Mr. Shekar
Your friend is having a proof for total 5 lakhs CTC (3 fixed and 2 variable) which is very much available in the Offer letter. He can make use of it.
As advised by Mr. Sateesh, if the variables are pay then it must be paid through bank only but if the variable salary is of reimbursement category like Petrol Bill/conveyance reimbursement, Mobile / Telephone Bill Reimbursement, Medical Claim Reimbursement, School Fee/Tuition Fee reimbursement, etc, then it can be paid by cash. Even you get the same through Bank remittance then also it will not attract any Tax liability on it. (Hope I am correct, If not please correct me).
As said by Mr. Kamesh, you can clearly spell the same during interview time itself so that you can avoid any future confusion.
With warm regards
S. Bhaskar

From India, Kumbakonam
Hello S. Bhaskar,
I think you have got confused between 'variable pay' & 'reimbursements'.
Variable Pay is by & large related to the ACTUAL PERFORMANCE of the individual--sort of Incentive for the results shown for a specific duration. This is quite prevalent in the IT industry, but the Non-IT sector too is catching up with this model of Salary Structure now.

From India, Hyderabad
Variable is common in majority of the sectors now. I am in non-IT sector but Varaiable pay system is being followed but the same is reflected in the payslips and it is undergoing TDS deductions. The thread starter may be working in small company or prop. company where they resort to cash payment for Variable pay.

From India, Lucknow
Thanks a lot guys...
Seeing all ur comments, il just tell my friend to be kool as the variable n fixed parameters are already metioned in the offer letter.
I l ask him to tell in interview that he was paid 3lakhs as fixed and 2 lakhs as variable per month.
But in variable payout, they have just given cash which is not there in paysilp. So il ask him to tell frankly n manage.

From India, Hyderabad
The mode of payment of variable is generally mentioned by the structured companies ie., whether variable paid monthly / once in a quarter / once in six months / yearly pay out. Again if it is yearly pay out, the employer expects the concerned employee to be on board on the time of pay out. The proof that can be submitted on variable to the next employer is
1. Current company's offer/appoinment letter stating the variable package
2. If (variable pay) already received, either form - 16 or any letter issued for the variable pay (some companies do give an appreciation letter along with the VP sometimes mentioning their grade of performance like good, very good, excellent)
If he is not able to give anything of this sort then only way left out is let him not budge on his CTC demand and stick to what he expects keeping the current VP.

From India, Hyderabad
Dear All,
There is query from end. My company has given me variable pay of 1Lac against my performance. Whereas it is mentioned in a separate offer letter that "I will paid 50% of the amount if I have not achieved the target and if I have achieved I will be paid 100%.
This variable pay has not mentioned on CTC, it is separate.
Now if I am sharing this information to next company where I want to join I am telling them (Variable + Fixed) my package, they are not considering as my CTC.
Unfortunately variable pay I have always received through check. I cannot show them my bank statement as well.
Please help.

From India, Mumbai
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