What factor should be taken in to count while designing the variable compensation & what should be the ideal mix of variable & fixed compensation
From United States, Atlanta
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From United States, Atlanta
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Hi Rakshit,
The contents of the salary breakup are as follows. You can prepare it according to your own suitability. HRA should be 40 to 60% of the basic salary.
Fixed Components:
- Basic
- HRA
Variable Components:
- CCA
- Other Allowance
- Mobile Reimbursement per Month
- Educational Allowance
- Petrol Allowance
- Driver Allowance
- Washing Allowance
Gross Per Month = Sum of all the above components.
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 who are not covered under ESI, as the maximum ceiling for ESI is 10,000 per month. Any amount exceeding this will be covered under Mediclaim or as per company policy, often fixed at 1,250 per month which is tax-exempt.
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 referred to as CTC.
I hope this information helps you in preparing the required details at your end.
Regards,
Amit Seth
From India, Ahmadabad
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508The contents of the salary breakup are as follows. You can prepare it according to your own suitability. HRA should be 40 to 60% of the basic salary.
Fixed Components:
- Basic
- HRA
Variable Components:
- CCA
- Other Allowance
- Mobile Reimbursement per Month
- Educational Allowance
- Petrol Allowance
- Driver Allowance
- Washing Allowance
Gross Per Month = Sum of all the above components.
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 who are not covered under ESI, as the maximum ceiling for ESI is 10,000 per month. Any amount exceeding this will be covered under Mediclaim or as per company policy, often fixed at 1,250 per month which is tax-exempt.
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 referred to as CTC.
I hope this information helps you in preparing the required details at your end.
Regards,
Amit Seth
From India, Ahmadabad
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Compensation Structure.ppt
MODEL STRUCTURE OF COMPENSATION.do c