Dear Seniors
I have joined as a HR in an It company, here we need to modify the CTC. Till date salary was not structured. PF is also not deducting.Now the company is asking to make a structure of CTC in the new FY where these below heads are added.
Amount spent on employees training, welfare, refreshment, any party thrown by company, two outings in a FY, employee referrals scheme.
In the above scenario the CTC will be very high and net take home will be very low. How this will be calculated ..Pls help and guide.
Mili Bharadwaj

From India, Jamshedpur
Industrial Relations And Labour Laws
Partner - Risk Management
Sr. Hr Manager
Dhirajkumar Sudhakar Pandey
Manager Admin & Facility
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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..)

From India, Bangalore
Dear Jeevarathnam
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.
Mili Bharadwaj

From India, Jamshedpur

dear feiend, here with attached excel working for your reference it is help for you regards prabu
From India, Chennai

HAI Please find attached ctc working for your reference
From India, Chennai

Attached Files (Download Requires Membership)
File Type: xls Master -15 Oct 2013.xls (173.5 KB, 1027 views)


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

From India, Mumbai
Dear Sir,
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.

From India, Pune
Dhirajkumar Sudhakar Pandey
HI Sir, I need to know the Minimum wages of Maharashtra State for the Year 2016. From January 2016 to June 2016 for 6th Month
From India, Bengaluru

If your Director wants that each and every pai spent on an employee like training, refreshments, gifts, outing, tea, coffee, and what not, to be included in the compensation, better ask him to refix everything based on the benefits that he or his organisation gets by employing the employee. It is really a cheating and these people do not understand that without human resources, they are not going to produce anything and without human factor the capital employed is a waste. Remember that each human resource values and that is why we ask "why should we take/ employ you" at the end of every personal interview with a candidate. If we do not have any benefit, will we employ any person? Will we tolerate to pay salary if he is sitting in the reserve bench.
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

From India, Kannur

Dear Mili
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)

From India, Indore

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