Designing Hotel Industry Compensation: What Salary Components Should I Include?

Dear Friends,

My company has recently diversified into the Hotel Industry. I take care of the complete compensation and benefits profile for my current division of the company and now have to design compensation structures for my Hotel division as well. Friends who are already working in the Hotel Industry, I request you to please share what salary heads you are using for designing CTC.

Kindly advise.

Regards,
Shilpi

Dear Shilpi,

I am not from the hotel industry but can help you design the salary structure. After you get the approval of the gross amount of the incumbent, you are required to make the break-ups. The general approach is as follows (PER MONTH):

Basic - 50% of the Gross

HRA - 30%

Conveyance reimbursement - 11.67%

Medical - 8.67%

In addition:

LTA - is generally 10 to 14%

Gratuity - 4.85%

PF - 12%

Others like communication reimbursement, medical insurance, all can be added depending on the levels and designation.

Concepts like Target Variable Pay, which is around 10% of the gross, can also be structured. By this, you can frame:

Gross

CTC

TTR (Total target remuneration).

Hope this will be of some use to you.

BISHU

Hi Bishu,

I mentioned that I want some replies from the hotel industry because I want to know the trends they follow. Are the trends the same, or do they have different approaches?

Thank you for your reply.

Regards,
Shilpi