Check FIX Pay Case Updates : Gujarat Fix Pay Case Supreme Court :New Hearing Date Declared 05/04/2018

Check FIX Pay Case Updates : Gujarat Fix Pay Case Supreme Court :New Hearing Date Declared 05/04/2018 

Fixed pay is your actual monthly salary which includes Basic and bundle of all allowances minus tax paid. Variable pay is the percentage component of your fixed salary that you will not get monthly, but quarterly or yearly.
So suppose you have an offer wherein the package offered is 9 LPA such that fixed pay is 7.5 LPA and 20% variable. Then your monthly salary will be = (7.5/12) -PF - Tax. And the 20% variable which amounts to 1.5 lakhs will be paid to you either quarterly or yearly.
The variable payout depends on the company, for example, most service based industries have 10–15% variable and it will be paid to you quarterly based on your performance rating. Not all employees get 100% of their variable component. Whereas Big 4 firms like Deloitte, KPMG have 15–20% variable which is paid in full. And at times for high performers, its paid even more than that, but only in exceptional cases.

Fixed pay is guaranteed and it will be paid to you every month by salary.  This includes:
  1. Basic Pay
  2. DA (Dearness allowance)
  3. HRA (house rent allowance)
  4. Conveyance Allowance  etc.
Variable Pay mainly includes Performance Bonus that is not guaranteed and will be paid at the end of the year provided your performance is good and the Unit you worked makes a profit.
Sometimes, the Dearness Allowance is also not fixed and linked to price index.  So, DA keeps fluctuating every quarter i.e. it may go up or come down but payment of DA is assured; only the sum slightly varies.
Fixed pay is what is defined and fixed and you will get the same salary which was stated in the letter of  salary structure.  Your package = Fixed Pay(X% of total package) + Variable pay(100-X% of total package). So Variable pay is the part of your salary package .  you will get your fixed pay at the end of every month but you will get your variable pay once in a quarter(may differ from company to company). At the end of every quarter, company announces some percentage which would be given to you as part of variable pay.
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Check FIX Pay Case Updates : Gujarat Fix Pay Case Supreme Court :New Hearing Date Declared 05/04/2018
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