Seeking Your Expertise: Is My Salary Breakup Sheet Competitive and Clear?

Hi HR folks, I'm reaching out to leverage the collective wisdom of our group! I've attached a salary breakup Excel sheet I'm developing for [position title] (or [department] if position specific isn't relevant).

This is a draft for benchmarking purposes, and I'd love to get your feedback on:

Competitiveness: Does the overall compensation package (base salary + benefits) seem competitive for the current market?

Clarity: Is the breakdown of salary components clear and easy to understand?

Compliance: Are there any legal or compliance concerns with the listed components?

Any insights or suggestions you can offer would be greatly appreciated. Feel free to share your own salary structures (anonymously, of course) to help with the benchmarking process.

Thanks in advance for your expertise!

Don't you pay HRA to those who stay in owned houses or houses owned by their spouse? If an employee is residing in their own house, naturally, they will not get HRA, right? Then the gross salary will change, right? How are you going to adjust the same?

Similarly, LTA is put as part of the salary. Is it paid once in two years? What happens if the employee does not file proof of travel? Do you think that an employee can travel with, say, 19 thousand rupees?

Supplementary Allowance

You have put an amount which is almost equal to the basic pay as 'Supplementary allowance'. What is that? Why is it paid? Is it paid to all employees universally? Why is it called 'residual amount'? It represents the residual amount after putting figures in components like basic pay, HRA, etc., right? That establishes that the salary is decided first, and you have bifurcated the same for some purpose. What is that? Reduce the basic pay so that statutory payments like gratuity shall be reduced, right?

Supplementary allowance may include leave travel allowance (an allowance paid annually but not exempted from tax), education allowance (an allowance paid for the education of children of the employee), telephone allowance, etc., and these allowances are part of the salary for all purposes connected with labor law, like the computation of gratuity. Even for IT purposes, the same will be treated as salary income since it is not a reimbursement but an allowance.

Basic Pay and Gratuity

What is the purpose of keeping 40% of the gross salary as basic pay? Again, there is no benefit out of it. It is okay that in respect of employees whose basic wages are more than Rs 15,000, there would not be any additional cost by way of contribution over Rs 1,800, but what happens if the threshold limit of salary is increased from Rs 15,000 to Rs 25,000? Do you think that it is the basic salary alone that will qualify for the computation of gratuity?

@AishwaryaBhardwaj, why is the EPF contribution $1800 for the employer and not $1950? The employer is also paying administrative charges for that employee, so I believe that should be included in the CTC.