Industrial Relations And Labour Laws
Partner - Risk Management
Sr. Manager Hr/admin
Hr Asst Manager
Dhirajkumar Sudhakar Pandey
Manager Admin & Facility
As per my understanding the CTC is the total cost incurred by the ER against the EE. But at the same time you can't include the Training, Refreshment, Party expenses as CTC. Ofcource some of the welfare shall be added as CTC
The below are the commonly included in CTC
a) Fixed wages (Basic, DA, Conveyance Allowance, Medical Allowance, Food allowance, HRA, Special ALlowance, Night shift allowance etc)
b) Variable Wages (Incentives, Performance bonus, Retaining allowance etc)
c) Benefits (Gratuity, ER Contribution against the ESI & EPF, Statutory Bonus etc..)
22nd March 2016 From India, Bangalore
Thanks for your quick reply, It will help me too but my question is still unanswered.
The director is asking to make a format of CTC where all the expenses made on employee can be shown.Is there any way out where these can be applied.
23rd March 2016 From India, Jamshedpur
The definition of CTC is exactly what it says - the total cost of an employee to,the company, which includes the entire salary, all welfare activities, employes contribution to statutory dues and training cost. Of course for factories in remote location cost of stay, electricity etc
So yes, your director is correct when he says all these are to be included.
What you are referring to is a bastardised version of CTC that has become popular in india and used by HR teams to fool the candidates to thinking they are paid a lot when they are not.
So if the purpose is to know the actual cost, yes, all of these are to included
24th March 2016 From India, Mumbai
You gave a ctc calculation. In observing ctc calculation it is found out that pf contribution is not revised as per new ceiling.etc.If someone has basic is more than 16000/-,as per new calculation the contribution will be @15000/-.So please kindly revise the same.
25th March 2016 From India, Pune
Please read CTC Vs BTC posted sometime in 2007 by me and I thing the relevance of that article has not come down.
Madhu.T.K: CTC Vs BTC
26th March 2016 From India, Kannur
I think that CTC should not include welfare expenses, because a company has to pay certain amount which depends on companys turnover as welfare expenses and company can get rebate under Income Tax for welfare expenses, secondly a company has to spend certain amount as CSR (Corporate Social Responsibility) so your company can get rebates on expenditure of this nature and should not charge the same from employees.
In my opinion CTC should includes Salary, Employer PF & ESIC , Bonus, Gratuity, Leave Encashment, and any other payment which company pay to employee in cash like.
Avinash Dubey (HR)
26th March 2016 From India, Indore