Talk:Cost to company
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Section moved from article
[edit]I just removed the following section from the article. It has no sources, it's not written in an encyclopedic tone, and it's unclear whether these components are actually part of the employee's salary, or part of the CTC. --bonadea contributions talk 11:48, 16 January 2016 (UTC)
Components of the salary
[edit]Basic salary: Basic salary is the core salary and it is the fixed part of the compensation package. A number of other components are calculated in the basic salary. Generally, the basic salary depends upon the employee's designation or grade.
Allowance: Different types of allowance is given to employees such as house rent allowance (HRA), leave travel allowance (LTA), dearness allowance, convince allowance, city compensation allowance and children's education allowance.
Perquisites: Are special rights or privileges commonly enjoyed by a high position, such as rent free accommodations, car facility, interest subsidy on loan, reimbursement on medical bills and club facility.
Contribution to provident fund: Contribution to the provident fund is mandatory for Indian companies. Twelve per cent of the basic salary gets contributed from the employee for PF and another 12 per cent by the employer. So 24 per cent of the basic salary gets deducted.
Reimbursement: Sometimes employees are entitled to many reimbursements such as medical treatment, newspaper, phone bill etc. One would not get the money in salary but funds will be passed against submission of such bills. So these are not included to the monthly pay slip. Most of the cases, an upper limit is there for each category.
Life and health insurance: New joinees get excited when they come to know that their organisation is taking care of them and paying the premium of their life and health insurance. But in reality, it is included in the CTC.
Transport facility: Getting a car from office may sound really good but actually, transport facility or pick-and-drop facility is also a component of the package. The interest-free car loans are not actually free.
Subsidised meals: It is true that really there is no free lunch. Free lunch, subsidised meals from office canteen, food coupons even the tea or coffee come with a price tag to the employee.
Rent of the office space: It is surprising but true that sometimes the rent of office space (the space in the employee's cabin) is borne by the employee in his CTC.