Rolly, As i said earlier also, you are right ..we can fix a ceiling of Pf contri to Rs 780 pm in case of salary more than Rs 6500. Regards, Anu
From India, Calcutta
5From India, Calcutta
Dear Rolly
All legal implications are decided with respect to the Basic Salary of an Employee. At the same time point of time this part of the salary is pretty relaxing for an employee. At the present time most of the Allowances are also taxable. now you have to think that which allowances you are going to introduce in the salary break-up.
I'm afraid that you would not be able to achieve the purpose which you are trying to achieve, because:
by decreasing the Basic salary of your Employees they'll become de-motivated (company will shift the burden of Tax from itself to the Employees)
Although allowances are satisfactory but not like Basic salary
I would suggest that if you want to restructure the salary structure apply it to the new comers, not on the existing one, this will create a fuss in your org.
Asif Naqvi[/u][/i]
From United Arab Emirates, Sharjah
All legal implications are decided with respect to the Basic Salary of an Employee. At the same time point of time this part of the salary is pretty relaxing for an employee. At the present time most of the Allowances are also taxable. now you have to think that which allowances you are going to introduce in the salary break-up.
I'm afraid that you would not be able to achieve the purpose which you are trying to achieve, because:
by decreasing the Basic salary of your Employees they'll become de-motivated (company will shift the burden of Tax from itself to the Employees)
Although allowances are satisfactory but not like Basic salary
I would suggest that if you want to restructure the salary structure apply it to the new comers, not on the existing one, this will create a fuss in your org.
Asif Naqvi[/u][/i]
From United Arab Emirates, Sharjah
Hi,
Just to reply your query I dont see any satutory compliences in doing this. But make sure the total salary should be above 10k, otherwise you have to register with ESI.
But I do not think this the best employee friendly salary structure.
Thanks,
Manish
Just to reply your query I dont see any satutory compliences in doing this. But make sure the total salary should be above 10k, otherwise you have to register with ESI.
But I do not think this the best employee friendly salary structure.
Thanks,
Manish
hi maneesh after protracted discussions with forum members i feel there would be a complication involved as reducing basic also effects gratuity which is a statutory requirement. rolly
From India, New Delhi
From India, New Delhi
i hope u cant suddenly decrease the basic salary as it will afffect the entire benefits of the employees without the prior permission from the statutory authorities. Rukmane
From India, Madras
From India, Madras
HI,
You should not reduce basic pay, but at the same time during incriment new allowances can be added and one can intact basic pay same. Further to keep interst of an employees try to add first only that allowances where they can avail tax benefit maximum. this will up to certain extent stop them to raise their voice as there actual incriment will be more then what they are getting value wise per month.
YOGESH
From India, Vadodara
You should not reduce basic pay, but at the same time during incriment new allowances can be added and one can intact basic pay same. Further to keep interst of an employees try to add first only that allowances where they can avail tax benefit maximum. this will up to certain extent stop them to raise their voice as there actual incriment will be more then what they are getting value wise per month.
YOGESH
From India, Vadodara
Thankyou Yogesh for your input. Could you please further advise that what are the kind of allowances (not reimbursement) that can be added so as to provide tax benifit. Rolly
From India, New Delhi
From India, New Delhi
we can remodel the salary structure only after the employees' consent other wise we can not reduce the basic. if we do unilaterally it will attarct legal action against the management
From India, Delhi
From India, Delhi
Rolly,
You can reduce your basic and that will attact employees also for that you can add some allowances like Medical allowance (15000 Max p.a), LTA, Uniform Allowance. This will help u in restructuring because basic is taxable and if you split that taxable basic into non taxable allowances your employees will be happy as taxable income is reducing.
From India, Visnagar
You can reduce your basic and that will attact employees also for that you can add some allowances like Medical allowance (15000 Max p.a), LTA, Uniform Allowance. This will help u in restructuring because basic is taxable and if you split that taxable basic into non taxable allowances your employees will be happy as taxable income is reducing.
From India, Visnagar
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Creating a Competitive Salary Structure.doc
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