Dear All,
I just want to get cleared that if the Gratuity is the part of CTC, An employee must have get his Gratuity amount at the time of leaving company either he works for 2 years or more that 5 years.
I know that the payment of gratuity is payble on complition of 5 year working. But if company is not paying it every year or at the time of leaving, should it to be count as CTC?

From India, New Delhi
Dear Sharma,

In general, we are thinking that whatever the amount showing in the CTC, it should be paid to the employee as matter of rights. I would like to clarify that the term CTC is Cost to the Company as we aware. This is used by the Employer, to calculate the total expenses involved for engaging employee in a particular job profile. I repeat again, the owner for the term CTC is to Employer, not to the employee.

Therefore, from the CTC, Employee is eligible to get only the statutory payments as per the applicability of the various Act, includes of Payment of Wages, EPF, ESIC, Bonus, Gratuity, etc.,

Example: I wanted to start a business in a particular place, hence I am calculating the total expenses involved in this business for next one year, which includes of Rental, Manpower and other basic expenses and I derived some amount as total expenses. In case, in middle of the year, I am deciding to close the business, should I continually pay the rent to the Landlord as because I had calculated rent for the one year, in the beginning...

I hope, it is clear now...

From India, Chennai
Dear Sharma,
Hope the reply given by Pragnaa HRCS has clarified all the doubts you have in your mind.
CTC is total cost incurred by the company for 1 year for employing a candidate... which does not mean or imply that it is compulsory for an employee to get that amount mentioned in the CTC.
Therefore, an employee should take care of his gross salary or his take home pay instead of getting bothered about the Cost which would be incurred by the company. It is always advisable for employees to negotiate salaries on gross salary per month or take home pay instead of negotiating it on CTC. This CTC components vary from company to company & might be confusing for an employee to judge on what he would get finally.
The thinking concept over CTC should be changed...!!!

From India, Bangalore
Dear sharma.aksh,
Pragnaa HRCS has rightly said that CTC is cost to the company. This term is used by the Employer to calculate the total expenses involved for engaging employee. The term CTC is to Employer and not to the employee.
No doubt the employee is eligible to get gratuity on completion of 5 years of service but the employer is required to make provision of gratuity from beginning itself. Some of the employers take gratuity policy. The cost towards this provision or towards premium of gratuity policy comes to 4.15% of Salary (B+DA).
It is up to the employer what cost to take in CTC and what not. Some of the employers take the gratuity cost in CTC.
Thanks with regards.
Keshav Korgaonkar,Insurance Advisors,Corporate Advisors,Legal Advise,Wage and salary,,Labour Compliance Audit,SSI registration,NOC from

From India, Mumbai

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