Hi, Could you please guide me on how to include minimum wages in the Cost to Company (CTC) components? My current CTC comprises Basic Salary, House Rent Allowance (HRA), Special Allowance, and contributions to both the employer's Provident Fund (PF) and Employee State Insurance (ESI). I'm located in Gurgaon, India.
From India, Gurgaon
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From India, Gurgaon
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In India, minimum wages are a statutory requirement and must be paid to all eligible employees. Typically, the minimum wage is included in the basic salary component of the CTC. Here's a step-by-step guide on how to incorporate it into your CTC:
1. Check the minimum wage rate: The minimum wage rate differs from state to state in India. For Gurgaon, you will need to refer to the Haryana state's minimum wage notification, which is updated bi-annually.
2. Adjust the basic salary: If the basic salary component in your CTC is less than the current minimum wage rate, you need to adjust it to at least the minimum wage. This component becomes non-negotiable.
3. Re-calculate components: After adjusting the basic salary, you may have to re-calculate other salary components like HRA, and contributions to the PF and ESI, which are typically a percentage of the basic salary. Ensure that these components adhere to the statutory requirements.
4. Review your CTC: Finally, review the total CTC to ensure it aligns with your company's compensation policy and budget.
Remember, non-compliance with the minimum wage law (Minimum Wages Act, 1948) can lead to legal repercussions. Therefore, it's crucial to stay updated with the changes in the law and amend your CTC components accordingly.
From India, Gurugram
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251. Check the minimum wage rate: The minimum wage rate differs from state to state in India. For Gurgaon, you will need to refer to the Haryana state's minimum wage notification, which is updated bi-annually.
2. Adjust the basic salary: If the basic salary component in your CTC is less than the current minimum wage rate, you need to adjust it to at least the minimum wage. This component becomes non-negotiable.
3. Re-calculate components: After adjusting the basic salary, you may have to re-calculate other salary components like HRA, and contributions to the PF and ESI, which are typically a percentage of the basic salary. Ensure that these components adhere to the statutory requirements.
4. Review your CTC: Finally, review the total CTC to ensure it aligns with your company's compensation policy and budget.
Remember, non-compliance with the minimum wage law (Minimum Wages Act, 1948) can lead to legal repercussions. Therefore, it's crucial to stay updated with the changes in the law and amend your CTC components accordingly.
From India, Gurugram
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Delhi - Minimum Wages w.e.f. 01.10.2012 (1).pdf
Minimum Wages in Maharashtra for the period January 2018 to June 2018.xls