I wanted to know if it was right on the part of the company to include the contributions made by the Employer to the PF account in the Employees CTC. I was offered a CTC, and in the break-up, all the contributions made by the Employer are also included in it (Gratuity, Medic premium, and PF too). Can I question them regarding this?
From India, Bangalore
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From India, Bangalore
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Hi,
Yes, it is right. The contributions made by the employer to your PF account, as well as gratuity, mediclaim, etc., are all costs to the company. The company is spending towards these heads on you. CTC = Cost to Company. It is inclusive of everything that a company is spending on you.
Regards, Rajeev Dixit
From India, Bangalore
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113Yes, it is right. The contributions made by the employer to your PF account, as well as gratuity, mediclaim, etc., are all costs to the company. The company is spending towards these heads on you. CTC = Cost to Company. It is inclusive of everything that a company is spending on you.
Regards, Rajeev Dixit
From India, Bangalore
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Well said, Rajeev Dixit!
CTC (Cost to Company) means the amount the company is spending on you throughout the year. It includes every amount paid by the company to you or on your behalf, such as ESI and PF. However, it is not a good practice to include gratuity in CTC because it may or may not be given to the employee (subject to a clause of 5 years of service length). Despite this, some companies continue to follow this practice.
Chill, HR!
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From India, Gurgaon
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CTC (Cost to Company) means the amount the company is spending on you throughout the year. It includes every amount paid by the company to you or on your behalf, such as ESI and PF. However, it is not a good practice to include gratuity in CTC because it may or may not be given to the employee (subject to a clause of 5 years of service length). Despite this, some companies continue to follow this practice.
Chill, HR!
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From India, Gurgaon
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Agreed with Rajeev, only the employer's share should be counted while designing CTC: Salary + EPF (Employer) + ESIC (Employer) + Gratuity cont. + Leave encashment + Mediclaim + any other expenses on the employee's head.
Thanks & Regards,
Sumit Kumar Saxena
From India, Ghaziabad
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Thanks & Regards,
Sumit Kumar Saxena
From India, Ghaziabad
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Dear Mr. Atchayapaathiram,
The contributions made by the employer to your PF account, as well as Gratuity, Mediclaim, LTA, Bonus, ESIC, and any other expenses on the employee's head.
Note: Travel Allowance that is submitted by employees against a travel bill is not mentioned in your appointment letter because travel allowance is not certain. However, all the statutory expenses along with salary components spent by the employer on the employee's head are known as CTC (Cost to the company).
Note: Dear Mr. Dixit, thanks for the good suggestion and using simple words.
Kumar Malay Kishor
From India, Ranchi
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The contributions made by the employer to your PF account, as well as Gratuity, Mediclaim, LTA, Bonus, ESIC, and any other expenses on the employee's head.
Note: Travel Allowance that is submitted by employees against a travel bill is not mentioned in your appointment letter because travel allowance is not certain. However, all the statutory expenses along with salary components spent by the employer on the employee's head are known as CTC (Cost to the company).
Note: Dear Mr. Dixit, thanks for the good suggestion and using simple words.
Kumar Malay Kishor
From India, Ranchi
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I also endorse the responses by Rajeev Ji, Chill HR, and Sumit Ji.
Further, I would suggest that when an interview candidate negotiates with the prospective employer for their package, and the prospective employer talks about the package in terms of CTC (Cost to Company) which includes the PF (Provident Fund) ER (Employer) share, Gratuity, etc., the interview candidate should also discuss their current emoluments in terms of CTC, which includes the PF ER share, Gratuity, etc.
From India, Mumbai
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Further, I would suggest that when an interview candidate negotiates with the prospective employer for their package, and the prospective employer talks about the package in terms of CTC (Cost to Company) which includes the PF (Provident Fund) ER (Employer) share, Gratuity, etc., the interview candidate should also discuss their current emoluments in terms of CTC, which includes the PF ER share, Gratuity, etc.
From India, Mumbai
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Thank you all for your suggestions. Hope to be more careful and proactive when going for the next interview. So NOW THERE IS NOTHING THAT I CAN BARGAIN? I have received my first salary!!
From India, Bangalore
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From India, Bangalore
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Dear Mr. atchayapaathiram, Congratulates for your new job and wish you happy and bright future
From India, Ranchi
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From India, Ranchi
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I am making salary salary brakeup ; what amount i should take as gratuity is basic is fixed as Rs. 22000/- pm I s there any fixed formula for gratuity, superannuation etc. Thanks,
From India, Jaipur
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From India, Jaipur
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Gratuity is calculated as 15 days' salary for every completed year of service (a period above six months is treated as one full year). To arrive at the daily salary, divide the basic pay + DA (if given) by 26, i.e., (Basic + DA) / 26 * 15 * Number of completed years of service. It's important to note that gratuity is paid only after completion of 5 years.
Regards
From India, Hyderabad
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Regards
From India, Hyderabad
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Gratuity-Leave calculation on CTC-Rev..xls
PF NO Contribution on CTC.pdf