How Can We Create a Fair Employee Grading and Salary Structure for Our Small Software Team?

payal123
Hi,

We are a software company with 25 employees. We would like to create an organizational structure and grade the employees so that their incentives and salaries can be decided accordingly. Please give suggestions on the same.

Thanks,
Payal
Amitmhrm
Hi Payal,

If it's a software development company, then you may grade them as follows:

Grade 1: Project Manager and other Manager categories

Grade 2: Team Leaders and other similar positions

Grade 3: Software Developers

Grade 4: Trainees

Grade 5: Support staff

The contents of the salary breakup are as follows; you can prepare it according to your needs. HRA would be 50% or 60% of the basic salary.

- Basic
- HRA
- TA
- Other Allowance
- Mobile Reimbursement
- Medical Reimbursement

Gross Per Month = Sum of all the above.

Gross Per Annum = 12 * Gross/Month

PF Contribution = 12% of Basic/Annum

ESI Contribution = 4.75% of Gross/Annum

Medical = The mediclaim facility provided to employees not covered under ESI, as the ESI ceiling is 10000/month. Amounts above this will be covered under Mediclaim or per company policy.

Ex-Gratia/Bonus = A fixed amount as a Bonus

Annual Fixed Gross Cost = Gross/Annum + Ex-gratia

Annual Total Cost = AFGC + PF + ESIC

Annual total cost is also known as CTC.

I hope this information helps clarify your queries to some extent.

Regards,

Amit Seth.
shinithomas
Please help me. I am new in HR and I want to know about the separation of grades. I am working as an Admin Officer in a pharma company based in Bangalore.
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