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Salary Structure

Planning the salary structure of the employee is important due to the following reasons

  • To reduce the tax burden of the employees
  • To reduce the statutory liability of the company
           Many statutory liabilities of the employer towards the employees are based on their salary. the salary should be structured in such a way that it reduces the exposure of the employer towards future contingencies that may arise due to dispute between the employer and employee. It should result in lower gratuity burden on the employer. but should not be below the minimum wage prescribed under the minimum wages act in India.
  • To increase the take home pay of the employee
           In this competitive world retaining good employees is the key to organisation's success. The payroll should be designed in such a way that the employee get maximum take home pay.

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