In a very strong move against companies misleading candidates with false ctc figures, IIM's have instructed companies to give a more accurate information on Salary. They have advised companies to shoe exact minimum cash component a candidate will receive excluding Bonus and performance pays. And companies can specify another component MEP, ie maximum earning potential which can include bonuses, and other variable components.
In Indian it industry the CTC is another way of companies inflating salary to lure employees. CTC – cost to company, in many cases is irrelevant to employees. By showing a bloated figure including maximum variables and other non cash contributions companies often cheat potential candidates. It is a sad fact that this is how many of our leading companies like tata consultancy services (tcs) , infosys et al make offers.
With the move from IIM's this should also be enforced in all colleges and universities to protect students and providing more easy way of understanding their future salaries.
Way to go. I know multiple instances where lateral hires were mislead by CTC numbers and end-up getting same or even less take home salary post joining. But partly lateral hire’s also have to be held responsible. What good a lateral hire is if he even couldn’t understand offer letter and read between lines.
As initiated by IIM’s, it is a good start to provide break-up’s like Minimum Cost component, Minimum and maximum performance pay’s and how it will assessed. i.e. Performance pay may be dependent on individual, company and the business unit which he belongs. So need a clear outline about how the performance will be measured for all components in performance pay.
Bonus – Atleast as for as I know, there is no bonus component in TCS atleast. So not exposed to all tricks in this trade.