Compensation on Transfer to Bangalore - under what head and how to calculate the amount?

anand-jadhav
we have transferred 1 employee to Bangalore as we have started new site, we are contractors in the construction field.
As Mumbai was the hometown of that employee, he has to spend on food in Bangalore as we gave him bachelor's accommodation.
so we have to give some amount to him for his food expenses in Bangalore.
My question is that it will come under what head and how to calculate the amount?? how to decide the same??

Seniors Please help me in this regard.
drsivaglobalhr
Dear Colleague,
From City to City the difference mainly will be majorly on :

1. House Rent Allowance
2. Food Expenses ( Living Expenses)

These two factors are linked to the City where the Cot of Living will differ much from city to city. You may consider Components like - Increase or adjustments in HRA / Adjustments in Living Allowance

In some companies they have fixed HRA, Food Allowance etc but they have a component called LOCAION ALLOWANCE OR CITY COMPENSATION ALLOWANCE in which you may bring a Package as a policy covering all your major sites / locations/ cities after study on cost of living in those places and keep this varying from location to location. If metro cities where cost of living will be higher you may have higher allowance and if it is low cost of living 3 tire cities then less allowance. This will bring transparent system in place.

All the Best, God Bless
Dr.P.SIVAKUMAR
Doctor Siva Global HR
Tamil Nadu
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