Madhu.T.K
Industrial Relations And Labour Laws
Sarojdeka
Hr-professional
Ops115
Director, Osats, New Delhi
Satyajeetpadhee
Hr Executive
Mirza
Regional Hr Head
Mailmesrikant
Hr Executive
Daisy Singh
Sr. Manager(hr)
Vinisha Wilfred
Hr Professional
SUNDER TOMER
Hr Officer
+3 Others

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Dear Members,
What should be the components of CTC? Whether Gratuity can be a part of CTC? Also what other components can be used for CTC. My company is into Education, Websites & Entertainment located in Noida. The manpower strength is 200 approx. We are in the process of finalizing the HR policies. During salary structuring also we are facing problem . Kindly help.
Thanks & Regards,
Daisy Singh

Hi Daisy,
Yes, Gratuity is part of CTC..... what is CTC means.... Cost to Company i.e. whatever the cost that is invested on an employee will be a part of CTC
hope you got the clarity.... if you still need any more clarifications you can touch base with me

Dear Mirza,
Thanks for reply. Suppose the employee does not not continue his services for 5 yrs. then what will be done with the deducted amount? Also what all can be the components of CTC?
Thanks & Regards,
Daisy Singh

Hi Daisy,
While making the CTC you are not deducting anything, instead you are adding the additional cost of an employee to his gross salary.Need not to worry as this is understood that Gratuity is paid only after 5 years of continuous services or else you can explain it your employee while offering them CTC. Other than gross salary you can add below components to an employee's salary
1) Employer's share of PF contribution
2) Employer's Share of ESI contribution( If applicable)
3) Any Premium paid towards Medical Insurance
4) Amount paid towards lunch
5) Amount paid towards transportation
6) performance Bonus/ yearly bonus paid.
7) Any other monitory benefit provided by an employer
Thanks
Roopa Mehra

HI,
Suppose a employee's monthly salary or say monthly ctc is Rs 30,000,then bifurcation can be done as below :
Basic salary = 12000 (40% of 30,000)
Hra = 4,800 (40% of 12,000 for non metro & 50% of basic in case of metro)
Medical = 1,250
Conveyance = 800 (Fixed)
Special = 11,150 (30,000-basic+hra+medical+conv.)
Less : P.T = 200 (State wise differs)
PF = 780 (IF BASIC is more than 6500=6500*12%,if basic is less than 6,500=whatever basic*12% )
THE ABOVE ARE THE VARIOUS COMPONENTS OF CTC.
REGARDS.
SATYAJEET PADHEE.

HI,
Yup.. gratuity should not be included as a component part of CTC.Because gratuity is something paid to the employee after successful completion of 5 years in an organisation.It is paid to the employee for his loyalty towards the company and it is paid on a F&F (full and final settlement) basis on a lump sum.That is why gratuity is not included as a component part of CTC.
Regards,
SATYAJEET PADHEE

It is normally a gratuity given to a person having been in a company for more than Five years which is not tabulated in CTC and therefore gratuity should not be included as a component part of CTC. As gratuity is something paid to the employee after successful completion of 5 years in an organisation.It is paid to the employee for his loyalty towards the company and it is paid on a F&F (full and final settlement) basis on a lump sum.That is why gratuity is not included as a component part of CTC.
In sugar industry this is the norm.
Vasudev

Dear, Vasudev Sir, Can you tell me that how calculate gratuity after successfully completion five year. Regards Tinwkle
Dear Twinkle,
For making more clear regarding Gratyry you can take the example of Vodafone Thank you card. It is just a compny's loyality towards the employee for the service of the employee. The calculation of gratyty is- {(15/26)*last Drawan Salary(Basic+DA))}No. Of Working Year. For more clarification u you can make touch with me on

Gratuity should be included only after his service of five years in the company. The amount of the gratuity may be kept as reserve in the company till the individual employee completes five years of service therein.

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