what is beneficial for employees,to provide with superannuation benifits or give the amount as part of the salary?
From India, Mumbai
Acknowledge(0)
Amend(0)
From India, Mumbai
Acknowledge(0)Amend(0)
Dear Sir,
My question pertains to my observation regarding certain employers who withhold a portion of the salaries of employees earning a monthly income of barely 18-20k. Please note that superannuation is included in the CTC. This issue does not arise for high-salaried employees.
Is it beneficial to block this money or offer a higher take-home salary instead?
Regards, Zubin.
From India, Mumbai
Acknowledge(0)Amend(0)
My question pertains to my observation regarding certain employers who withhold a portion of the salaries of employees earning a monthly income of barely 18-20k. Please note that superannuation is included in the CTC. This issue does not arise for high-salaried employees.
Is it beneficial to block this money or offer a higher take-home salary instead?
Regards, Zubin.
From India, Mumbai
Acknowledge(0)Amend(0)
Dear Zubin, the tone of your original question would certainly compel a retired senior citizen like me, living as independently and happily as before, to give such an answer only. Now, your further questions substantiate my answer statement for the simple reason that the concept of CTC, which is in vogue in certain countries like India and some countries in the African continent, is primarily to woo job-seekers.
Understanding CTC and Its Components
Time and again, the concept of "C.T.C" has been explained in this forum and categorically stated by many members that all the components represented in the CTC do not form part of the take-home salary of the employee. CTC is only a mere projected value of the overall expenses incurred by the employer per employee in a year. "Superannuation" in the realm of employment is a future event contingent upon normal termination of employment on reaching a particular age fixed in the contract of employment by the employee, coupled with the completion of a minimum period of service. It may comprise a one-time lump sum payment called gratuity at the time of termination and/or a periodical payment like a pension after termination. The employer has to create a fund for this purpose and contribute to such a future fund every year in respect of the employee on an actuarial basis. Therefore, it is an inevitable current expense incurred by the employer and therefore chargeable to the cost of employment.
Salary Negotiation and Employee Vigilance
Coming again to the point of the right understanding of the concept of wages/salary/remuneration payable to a prospective employee in the salary negotiation stage, though he may be wooed by the employer with the grandeur and enormity of CTC, the employee should be more vigilant about what would come to his hand every month only. The employee should not forget that the monthly salary coming to his hand is the actual value of his current employability and the others projected in the CTC are both statutory fringe benefits as well as incentivizing his retention in the long run.
From India, Salem
Acknowledge(3)Amend(0)
6108Understanding CTC and Its Components
Time and again, the concept of "C.T.C" has been explained in this forum and categorically stated by many members that all the components represented in the CTC do not form part of the take-home salary of the employee. CTC is only a mere projected value of the overall expenses incurred by the employer per employee in a year. "Superannuation" in the realm of employment is a future event contingent upon normal termination of employment on reaching a particular age fixed in the contract of employment by the employee, coupled with the completion of a minimum period of service. It may comprise a one-time lump sum payment called gratuity at the time of termination and/or a periodical payment like a pension after termination. The employer has to create a fund for this purpose and contribute to such a future fund every year in respect of the employee on an actuarial basis. Therefore, it is an inevitable current expense incurred by the employer and therefore chargeable to the cost of employment.
Salary Negotiation and Employee Vigilance
Coming again to the point of the right understanding of the concept of wages/salary/remuneration payable to a prospective employee in the salary negotiation stage, though he may be wooed by the employer with the grandeur and enormity of CTC, the employee should be more vigilant about what would come to his hand every month only. The employee should not forget that the monthly salary coming to his hand is the actual value of his current employability and the others projected in the CTC are both statutory fringe benefits as well as incentivizing his retention in the long run.
From India, Salem
Acknowledge(3)Amend(0)
Dear Mr. Zubin, the dictionary meaning of superannuation is "Send into retirement with a pension." Normally, superannuation benefits are extended to executive and managerial cadre. The company will form a Superannuation Trust, take a policy with an insurance company, and pay the premium annually.
I have been receiving my superannuation pension regularly from my previous employment. One-third of the amount was refunded immediately after relieving from service. Besides, a lump sum of money will be paid to the nominee after the death of the member. Please remember the tagline of LIC: "Zindagike saath bhi, Zindagike baad bhi."
From India, New Delhi
Acknowledge(1)
Amend(0)
I have been receiving my superannuation pension regularly from my previous employment. One-third of the amount was refunded immediately after relieving from service. Besides, a lump sum of money will be paid to the nominee after the death of the member. Please remember the tagline of LIC: "Zindagike saath bhi, Zindagike baad bhi."
From India, New Delhi
Acknowledge(1)Amend(0)
I want to add to my earlier comment. A company pays its staff as per market standards, skills, and financial position. All companies normally work on a going concern basis and work with an eye to the future. All well-run companies with a successful business model do some planning for employee benefits in the present and plan for retirement/superannuation benefits. Insurance policies, PF funds, and Gratuity are all ways to reward employees for service and are paid on exit or retirement, etc.
Just to increase pay in hand presently, no tweaking is possible in such benefits, most of which are mandated by law. So if you want to give more cash in hand to employees, consider a pay revision in a planned manner, taking revenue inflow into account among other factors that influence your business or product.
From India, Pune
Acknowledge(1)Amend(0)
Just to increase pay in hand presently, no tweaking is possible in such benefits, most of which are mandated by law. So if you want to give more cash in hand to employees, consider a pay revision in a planned manner, taking revenue inflow into account among other factors that influence your business or product.
From India, Pune
Acknowledge(1)Amend(0)CiteHR is an AI-augmented HR knowledge and collaboration platform, enabling HR professionals to solve real-world challenges, validate decisions, and stay ahead through collective intelligence and machine-enhanced guidance. Join Our Platform.
Employee Benefits.doc