To my opinion the topic has multiple dimension. In today's scenario for salary structure there are issues like Minimum Wages, PF effect, Gratuity effect, Bonus, ITAX friendly pocket for higher salary emps, Flexible pay, Variable pay etc. etc. My personal views regarding scientific salary structure are :-
1. It must protect the Minimum wages or more while paying monthly gross salary.
2. PF authority usually suggest 50% Basic/Basic & DA of monthly gross up to 15k monthly Basic/Basic& DA. Beyond that legally the authority has nothing to say. Therefore, up to 30k monthly gross salary PF gross (Basic/ Basic & DA) may be 50%. Beyond that it may be less than that.
3. More the Basic more the liability of Gratuity. Therefore, the Company's are controlling CTC considering all these factors
4. There are ITAX related pocket e.g. HRA, Conveyance, Medical, LTA etc. should be considered for higher salary level employees.
5. Not necessarily same salary structure and same % for all category of employees across the Organisation.
6. One example for salary structure - Technician category monthly gross ranges from 15k to 30 k where basic is 50% of monthly gross and 1600 conveyance allowance & rest is HRA. Supervisor category/Jr. Officer - monthly gross 35k to 50k and basic is 45% of monthly gross, conveyance 1600/- per mn , Medical allow- 1250/mn & rest is HRA. Yrly LTA pocket may be there considering the CTC effect. Asstt Manager/Manager Category - monthly gross 55k to 1 lac - basic is 40% of mnly gross, then conveyance and medical allowance as mentioned above and rest may be in HRA,CCA & LTA. Sr. Manager/GM and above - monthly gross 1.2 lac and above, basic is 35% of mnly gross, Conveyance, Medical, HRA, CCA,LTA etc rest plus may be some variable pay as incentive ( formula may be based on business result & individual performance etc.) to offer/meet certain CTC level. There may be certain other perks eg. Co's car, Club membership etc. etc.
7. Some Organizations now a days are offering flexible pay where against certain CTC- mnly gross is fixed, basic is fixed and certain items of salary structure are offered to individual for selection. May be some other innovative way other organizations are thinking today.
8. Unionized Organizations have pay structure ( basic structure) for different category of Unionized employees along with other items but for Management category usually determined by the organizations.
So to my opinion it is not a very simple task - need detail study and vary from organization to organization.
Thanks & Regds.,
S K Bandyopadhyay, Kolkata
USD HR Solutions
+91 98310 81531 9th June 2017 From India, New Delhi