BASIC , GROSS , NET SALARIES & CTC
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What is a Salary?
Salary is the regular payment made by an employer to his or her employees in exchange for the work performed by them. It is paid at fixed intervals, generally on a monthly basis, and often expressed as an annual sum.
Basic
Salary
It’s the figure agreed upon between a company, its employee, without factoring in bonus, overtime, or any kind of extra compensation. It’s a fixed sum paid to employees in exchange for the work performed by them. The basic income is derived before any reductions or increases due to overtime or bonus, allowances are made.
Gross Salary
It’s the sum of all wages, salaries, profits, interest payments, rents, and other forms of earnings, before any deductions or taxes. It is opposed to net income, defined as the gross income minus taxes and other deductions. it’s the term used to describe all the money an employee has made working for the company in a year. It is the salary which is without any deductions.
Net Salary
Net salary, or more commonly referred to as take-home salary, is the income that an employee actually takes home after tax, provident fund and other such deductions are subtracted from it.
Net Salary = Gross Salary - Income Tax - Public Provident Fund - Professional Tax.
Net Salary is usually lower than gross salary.
CTC
Cost to company is the amount a company spends on an employee and Gratuity is what it pays to the employee at retirement. However, Gross Salary is what a company pays to an employee before deductions and Net Salary is what an employee receives after deductions.
Conclusion
Employees
will be much more invested in their jobs and in the company they work for if
they feel valued by that company. A higher salary is a way to show
employees that they are valued. Companies can also demand higher quality of
work and higher levels of productivity in exchange for that higher salary.
Increased
Employee Motivation ... Properly paid
employees shows you value them as workers and as human beings. When
people feel valued, they feel better ...
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References
Heath,
R. L. & Bryant, J., 2000. Human Communication Theory, And Research. NJ:
Lawrance Arlbaum Associates.
Lynton,
R. P. & Pareek, U., 2000. The Human Development Handbook. London: Kogan
Page Limited.
Salary is fixed regular payment, typically paid on a monthly basis but often expressed as an annual sum, made by an employer to an employee, especially a professional or white-collar worker.
ReplyDeleteSalary is a set sum of money paid by an employer to their employees in exchange for their services. It is a recurring payment paid by the employer at a specified interval of time, usually monthly and usually in the form of an annual package. Salary is usually calculated by comparing employees' wages for a similar function in the same or a different Industry. Salary is also divided into two primary groups (Thakur, 2020).
ReplyDeleteInteresting topic.But I believe employee benefits are more significant than pay, since they improve employee happiness and give a better experience. While a competitive pay is vital, other forms of remuneration, such as benefits or unique perks, can be even more effective in attracting and retaining talent.
ReplyDeleteA well-paid employee feels valued by his organization. He knows management isn’t just paying him to get the job done, he’s also respected for his subject matter expertise. This employee is more likely to be satisfied with his job and not feel the need to look for a similar position with better pay. However, an employee who doesn’t feel like his organization is paying him a high enough salary is much more likely to look for and accept a higher paying position of a comparable nature at another company.
ReplyDeleteIn a Society for Human Resource Management Employee Job Satisfaction and Engagement survey, employees rated compensation as the third most important aspect of job satisfaction (Chron, 2020).
In some of the company's introduce Incentive Scheme, to get attracted for much return.
ReplyDeleteCTC is the amount spent on an employee by a company, and Gratuity is the amount paid to the employee upon retirement. However, Gross Salary refers to the amount paid to an employee before deductions, and Net Salary refers to the amount paid to an employee after deductions. Interesting topic.
ReplyDelete