dear everyone,
i want to know how to divide salary of rs. 18000 and as well as rs. 8000 when there is no pf deduction as firm has below 15 employees and most of us live in our own houses.
what must be the basic salary and is dearness allowance can be avail by a private sector employee or it is just for govt. employee................and also make me know some more about medical allowance.
my firm policy does not include any medical benefits also so anyone please suggest how the salary division can be done which fill be helpful for employees at anytime to avail loans and other work can also be done with the help of salary statement.......also make me know about that which part of divided salary is seen by any bank before providing loans
or is it mandatory to divide salary if not then what can be done.
thanks and regards
Taisha
From India, Bhopal
i want to know how to divide salary of rs. 18000 and as well as rs. 8000 when there is no pf deduction as firm has below 15 employees and most of us live in our own houses.
what must be the basic salary and is dearness allowance can be avail by a private sector employee or it is just for govt. employee................and also make me know some more about medical allowance.
my firm policy does not include any medical benefits also so anyone please suggest how the salary division can be done which fill be helpful for employees at anytime to avail loans and other work can also be done with the help of salary statement.......also make me know about that which part of divided salary is seen by any bank before providing loans
or is it mandatory to divide salary if not then what can be done.
thanks and regards
Taisha
From India, Bhopal
Dear Taisha-Prabhakar,
Notwithstanding the etymological differences, pay, salary or wages refer to the compensation or remuneration that can be computed in terms of money payable by the employer to a paid employee as per the terms of contract of employment for the services rendered by him/her. It can be wholesome or bifurcated into basic and other allowances. Allowances are paid to meet out certain specific heads of expenses likely to be incurred by the employed person on account of his/her employment as well as in the form of fringe benefits. Thus the overall structure of wages/salary/remuneration can be wholesome or consolidated or divided into components such as basic, dearness allowance, house rent allowance, conveyance allowance etc.
Generally, several factors influence the determination of the quantum/level of wages in an organization which hire the services of the employees. The most significant ones among them are (1) the capacity of the employer to pay out of the value addition contributed by the employees (2) remuneration in comparable industries in the region or in the same industry (3) cost of living (4) productivity (5) bargaining power of the workmen/ trade union based on the demand and supply of labor (6) mandatory statutory regulations applicable to the industry.
Therefore, the emerging structure of the wages depends on the above factors. If it is a consolidated fixed sum, a certain percentage on the basis of which has to be compulsorily set aside as indirect statutory employment benefits such as contributions to ESI and EPF, gratuity, bonus which will cost more than the same wages broken into components. Thus the practice of dividing the entire salary/wages into components came into vogue in the field of wage and salary administration. The statutory regulatory measures of payment of wages including authorised deductions thereof, fixation and enforcement of minimum wages, compulsory contributions both from employer and employee to ESI and EPF, contribution to gratuity fund and income tax concessions make the apportionment of wage/salary into several components as inevitable.
However, with a view to curbing the tendency to devise the salary structure into disproportionate components so as to deprive the working classes of the indirect employment benefits, section 2(y) of the Code on Wages,2019 which is slated to come into force w.e.f 01-04-2021 defines the term wages in such a manner that the proportion of the sum of the components of basic, dearness allowance and retaining allowance, if any shall always remain 50:50 to the sum total of all other allowances and the eventual short fall if any, in the former would be made good from the latter.
Therefore, the take is yours to devise the wage/salary structure of your employees according to the statute as well as future developments.
From India, Salem
6018Notwithstanding the etymological differences, pay, salary or wages refer to the compensation or remuneration that can be computed in terms of money payable by the employer to a paid employee as per the terms of contract of employment for the services rendered by him/her. It can be wholesome or bifurcated into basic and other allowances. Allowances are paid to meet out certain specific heads of expenses likely to be incurred by the employed person on account of his/her employment as well as in the form of fringe benefits. Thus the overall structure of wages/salary/remuneration can be wholesome or consolidated or divided into components such as basic, dearness allowance, house rent allowance, conveyance allowance etc.
Generally, several factors influence the determination of the quantum/level of wages in an organization which hire the services of the employees. The most significant ones among them are (1) the capacity of the employer to pay out of the value addition contributed by the employees (2) remuneration in comparable industries in the region or in the same industry (3) cost of living (4) productivity (5) bargaining power of the workmen/ trade union based on the demand and supply of labor (6) mandatory statutory regulations applicable to the industry.
Therefore, the emerging structure of the wages depends on the above factors. If it is a consolidated fixed sum, a certain percentage on the basis of which has to be compulsorily set aside as indirect statutory employment benefits such as contributions to ESI and EPF, gratuity, bonus which will cost more than the same wages broken into components. Thus the practice of dividing the entire salary/wages into components came into vogue in the field of wage and salary administration. The statutory regulatory measures of payment of wages including authorised deductions thereof, fixation and enforcement of minimum wages, compulsory contributions both from employer and employee to ESI and EPF, contribution to gratuity fund and income tax concessions make the apportionment of wage/salary into several components as inevitable.
However, with a view to curbing the tendency to devise the salary structure into disproportionate components so as to deprive the working classes of the indirect employment benefits, section 2(y) of the Code on Wages,2019 which is slated to come into force w.e.f 01-04-2021 defines the term wages in such a manner that the proportion of the sum of the components of basic, dearness allowance and retaining allowance, if any shall always remain 50:50 to the sum total of all other allowances and the eventual short fall if any, in the former would be made good from the latter.
Therefore, the take is yours to devise the wage/salary structure of your employees according to the statute as well as future developments.
From India, Salem
Community Support and Knowledge-base on business, career and organisational prospects and issues - Register and Log In to CiteHR and post your query, download formats and be part of a fostered community of professionals.
Salary-Note.doc
SALARY SHEET CALCULATION.xls