Hi Seniors,
Sub: Remuneration Query
My company has decided to change the remuneration terms to CTC from Gross. I would like to know the accurate process to proceed with this change. It would be very helpful if I could receive the proper format of the 'amended remuneration terms' to have them acknowledged by existing employees.
Seeking your guidance.
Thanks,
Ankita Bhavsar
From India, Ahmadabad
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5Sub: Remuneration Query
My company has decided to change the remuneration terms to CTC from Gross. I would like to know the accurate process to proceed with this change. It would be very helpful if I could receive the proper format of the 'amended remuneration terms' to have them acknowledged by existing employees.
Seeking your guidance.
Thanks,
Ankita Bhavsar
From India, Ahmadabad
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Dear Ankita,
CTC means "Cost to the Company." Any benefit which you can cost and put a figure to it becomes a component of the CTC. Attached is an Excel sheet which captures most of the components of a CTC. In your company, the salary and benefits components may vary; hence, you can add those also and arrive at the CTC for an employee. If you want to give an employee a CTC of Rs. 10.00k, then just change the figures in column G23. You will get the CTC breakup for p.m. and p.a.
Regards,
Bobby
From India, Pune
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CTC means "Cost to the Company." Any benefit which you can cost and put a figure to it becomes a component of the CTC. Attached is an Excel sheet which captures most of the components of a CTC. In your company, the salary and benefits components may vary; hence, you can add those also and arrive at the CTC for an employee. If you want to give an employee a CTC of Rs. 10.00k, then just change the figures in column G23. You will get the CTC breakup for p.m. and p.a.
Regards,
Bobby
From India, Pune
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Dear Bobby & Vaibhav,
Thanks to share the detail & try to solve my query. But my actual concern is different than this. I am well aware about all this calculation related to CTC. the only big challenge is convincing existing employees for CTC structure & void the previous dues of employers liabilities i.e Bonus, ESIC Contribution, Gratuity etc.
Now I am looking at the right procedure to follow ahead with having final contain in it which includes history & mistory too along with half yrly increment!
I have drafted following but i am not satisfied with it. So please do suggest me right procedure.
====
Date:
Sub: Revised CTC Remuneration
Dear ..
The management takes great pride in reappointing you as ‘Designation….’ in Concept Infoway Pvt. Ltd. w.e.f. <DOJ>…...
As mutually agreed, your monthly revised cost to company remuneration is Rs. …../-, inclusive of other allowances and subject to deduction of any statutory or any other deductions.
It will be increased on below mentioned date & time, based upon your all round performance during the tenure. However, in case of your poor performance the increment can be withheld also at the sole discretion of the Management. Increments are neither automatic nor a right.
Effective Date & Month Monthly Revised CTC Remuneration Amount
/-
/-
/-
The bifurcation of your salary into various heads is at the sole discretion of the Management. The Management is further empowered to re-structure your cost to company remuneration at any time in future at its sole discretion.
We are delighted to have you in the company. Please indicate your understanding and acceptance of the above terms and conditions by signing and returning the duplicate copy of this letter.
Thanking you,
====
Thanks
Ankita
From India, Ahmadabad
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Thanks to share the detail & try to solve my query. But my actual concern is different than this. I am well aware about all this calculation related to CTC. the only big challenge is convincing existing employees for CTC structure & void the previous dues of employers liabilities i.e Bonus, ESIC Contribution, Gratuity etc.
Now I am looking at the right procedure to follow ahead with having final contain in it which includes history & mistory too along with half yrly increment!
I have drafted following but i am not satisfied with it. So please do suggest me right procedure.
====
Date:
Sub: Revised CTC Remuneration
Dear ..
The management takes great pride in reappointing you as ‘Designation….’ in Concept Infoway Pvt. Ltd. w.e.f. <DOJ>…...
As mutually agreed, your monthly revised cost to company remuneration is Rs. …../-, inclusive of other allowances and subject to deduction of any statutory or any other deductions.
It will be increased on below mentioned date & time, based upon your all round performance during the tenure. However, in case of your poor performance the increment can be withheld also at the sole discretion of the Management. Increments are neither automatic nor a right.
Effective Date & Month Monthly Revised CTC Remuneration Amount
/-
/-
/-
The bifurcation of your salary into various heads is at the sole discretion of the Management. The Management is further empowered to re-structure your cost to company remuneration at any time in future at its sole discretion.
We are delighted to have you in the company. Please indicate your understanding and acceptance of the above terms and conditions by signing and returning the duplicate copy of this letter.
Thanking you,
====
Thanks
Ankita
From India, Ahmadabad
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Dear Ankita,
CTC is the total investment by the company to the employee. As the Excel sheet (given by Bobby) shows, CTC = Gross (Basic+DA+HRA+Spl Allow) + Company's contributions to PF, ESI etc + Gratuity (around 5% of the Basic) + periodic allowances (like LTA, Med, furniture allows) + other perks (like car, house etc) translated to money. You may affix an Annexure to your letter stating all the components of the CTC, monthly, and yearly.
Rajusiachen
From India, Coimbatore
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CTC is the total investment by the company to the employee. As the Excel sheet (given by Bobby) shows, CTC = Gross (Basic+DA+HRA+Spl Allow) + Company's contributions to PF, ESI etc + Gratuity (around 5% of the Basic) + periodic allowances (like LTA, Med, furniture allows) + other perks (like car, house etc) translated to money. You may affix an Annexure to your letter stating all the components of the CTC, monthly, and yearly.
Rajusiachen
From India, Coimbatore
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Ankita,
The term CTC is ambiguous. The framework differs from one company to another. In the name of CTC, some companies are including mobile phone reimbursement, conveyance allowances given for outdoor duties, etc. No standard is being followed across various sectors. You can formulate your policy of including the heads under CTC, which may essentially be spent on employees other than company-related expenses or reimbursements.
pon
From India, Lucknow
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The term CTC is ambiguous. The framework differs from one company to another. In the name of CTC, some companies are including mobile phone reimbursement, conveyance allowances given for outdoor duties, etc. No standard is being followed across various sectors. You can formulate your policy of including the heads under CTC, which may essentially be spent on employees other than company-related expenses or reimbursements.
pon
From India, Lucknow
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Dear Friends,
Thank you for the very useful input provided for HR professionals. However, in Anita's letter, the words "Re-appointing" and "DOJ" should not be included. Instead, mention the date with reference to your previous Letter of Appointment (LOA) and ensure your previous services are not disrupted.
Regards,
PBS KUMAR
From India, Kakinada
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Thank you for the very useful input provided for HR professionals. However, in Anita's letter, the words "Re-appointing" and "DOJ" should not be included. Instead, mention the date with reference to your previous Letter of Appointment (LOA) and ensure your previous services are not disrupted.
Regards,
PBS KUMAR
From India, Kakinada
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Hi dear,
CTC is the total breakdown of the employee's monthly salary. The best way to understand in your case is CTC = Gross + employer's (PF, ESIC, insurance premium, clothing, or washing expenses etc.) and when you subtract employee's PF, ESIC, insurance premium, etc., you will get the net take-home of the employee. For details, please refer to the attachment.
Regards,
Sugeet
From India, Mumbai
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CTC is the total breakdown of the employee's monthly salary. The best way to understand in your case is CTC = Gross + employer's (PF, ESIC, insurance premium, clothing, or washing expenses etc.) and when you subtract employee's PF, ESIC, insurance premium, etc., you will get the net take-home of the employee. For details, please refer to the attachment.
Regards,
Sugeet
From India, Mumbai
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Dear Ankita,
The joining date won't be changed; only a letter you have to issue, which will be called a Salary revision letter. The date of joining and everything else will remain the same, only your salary structure will be revised.
Regards,
Sugeet
From India, Mumbai
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The joining date won't be changed; only a letter you have to issue, which will be called a Salary revision letter. The date of joining and everything else will remain the same, only your salary structure will be revised.
Regards,
Sugeet
From India, Mumbai
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Dear Ankitaji,
From all the views expressed above, I have some different perspectives on your problem. First of all, I do not understand why this problem is being discussed in this manner. Ankita, it is very difficult to change the remuneration into CTC without affecting the status of ESI/PF/Bonus/Gratuity or any other type of benefits that are already available. It is essential to know the type of industry you are working in, the status of agreements/union activities, or any other relevant background information to ensure how to protect your employer without facing any legal liability. This requires private, personal, and practical discussions. I believe that a solution can be found through these discussions. Whether you agree or not, my opinion is very clear. It is important to consider all these factors before moving forward.
Thank you, and have a good day.
P.L. Chhipa
From India, Udaipur
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From all the views expressed above, I have some different perspectives on your problem. First of all, I do not understand why this problem is being discussed in this manner. Ankita, it is very difficult to change the remuneration into CTC without affecting the status of ESI/PF/Bonus/Gratuity or any other type of benefits that are already available. It is essential to know the type of industry you are working in, the status of agreements/union activities, or any other relevant background information to ensure how to protect your employer without facing any legal liability. This requires private, personal, and practical discussions. I believe that a solution can be found through these discussions. Whether you agree or not, my opinion is very clear. It is important to consider all these factors before moving forward.
Thank you, and have a good day.
P.L. Chhipa
From India, Udaipur
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