Dear Colleague,
Whether to show or not to show the Statutory components like ESI into the CTC working and CTC Sheet is purely an internal call of the organization and it depends on Organization's compensation policy. There is no hard and fast rule or legal guidelines on this. This is a general practice of the Industry to have a CTC working sheet done and provided to each individual for clarity and better Compensation Administration.
The concept of CTC is to know and estimate the Cost to Company in respect of each and every talent engaged by them to arrive accurate budget / arrive increase % year on year. Further it gives clarity to both Employee and Employer to understand the eligible components and their break up. There are companies who are showing all statutory components including PF, ESI, Gratuity, Bonus and Profession Tax etc in the CTC Sheet. Lot of other companies do not show the Statutory components but mention that " In addition to the CTC the applicable Statutory Components line PF, ESI, Gratuity, Bonus, Leave with Wages, P.Tax are applicable as per Statute" like. Hence this is more of internal policy of the Organization and it is driven by the Compensation Policy of the Organization for their own convenience. From my practical experience it is better to bring all applicable components into the CTC sheet with clarity so that there is no dispute or difference in understanding later. It also helps in estimating the compensation and benefit cost easily.
From India, Chennai
305Whether to show or not to show the Statutory components like ESI into the CTC working and CTC Sheet is purely an internal call of the organization and it depends on Organization's compensation policy. There is no hard and fast rule or legal guidelines on this. This is a general practice of the Industry to have a CTC working sheet done and provided to each individual for clarity and better Compensation Administration.
The concept of CTC is to know and estimate the Cost to Company in respect of each and every talent engaged by them to arrive accurate budget / arrive increase % year on year. Further it gives clarity to both Employee and Employer to understand the eligible components and their break up. There are companies who are showing all statutory components including PF, ESI, Gratuity, Bonus and Profession Tax etc in the CTC Sheet. Lot of other companies do not show the Statutory components but mention that " In addition to the CTC the applicable Statutory Components line PF, ESI, Gratuity, Bonus, Leave with Wages, P.Tax are applicable as per Statute" like. Hence this is more of internal policy of the Organization and it is driven by the Compensation Policy of the Organization for their own convenience. From my practical experience it is better to bring all applicable components into the CTC sheet with clarity so that there is no dispute or difference in understanding later. It also helps in estimating the compensation and benefit cost easily.
From India, Chennai
Find answers from people who have previously dealt with business and work issues similar to yours - Please Register and Log In to CiteHR and post your query.
ESIC-Contributi on-Transfer-For m.pdf