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'Cost-to-company' misleading

Feb 09 2009 09:01 Helen Ueckermann

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Johannesburg - Job applicants are often tempted by a remuneration package which seems to pay out a lot more than they are currently earning - and then are hugely disappointed with their net pay.

There is a lot of confusion about the difference between "cost-to-company" remuneration and the net amount that the employee will get out, says Viv Gordon, CEO of Viv Gordon Placements.

Cost to company refers to the total amount that the employee will cost the company.

That could include a basic salary, the company's contribution to a medical aid, pension fund, unemployment insurance, group insurance, thirteenth cheque and bonus as well as the use of company assets like a car, petrol card, computer and software, loans, bursaries, insurance, home telephone, cost of share options, incentive schemes and even parking.

Job seekers should be properly prepared to discuss remuneration when the subject comes up in an interview.

Gordon says they should demand detailed information about all the benefits.

When a remuneration package is offered, make an appointment with the company's salary administrator to find out exactly what you will get out each month.

That's the only way you will be able to determine whether you will earn more than in your current position, she says

- Rapport

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Leah
Dec 29 2009 15:12 Report this comment

Hi What is a wise move between cost to company and basic salary? thanks

Kg
Oct 16 2009 15:53 Report this comment

lets be honest,for us to attract company's we use this fancy words on our resumes that u may find we dont even understand.so companies are also doing the same thing but its your responsibility as the candidate to ask for a break down during the interview.

Dumisani
Feb 09 2009 15:54 Report this comment

FYI(for your information)

the light side (cont
Feb 09 2009 13:50 Report this comment

......none of them included skills development levee, 2 of them included employer uif and one of them even included the cash value of leave days granted in excess of the BCEA. The golden rule, only dummies do not ask for a dummy pay slip.

The light Side
Feb 09 2009 13:48 Report this comment

I find teh readers comments more informative than the articles. The old 'basic' approach was just as bad as each company had their own add on's, eg entertainment allowance, cell phone allowance, fixed token travel allowance, looking in the mirror twice allowance etc. The problem with ctc is that all companies do not deem the same components to be ctc. or example, my last e3 employers have all offered a ctc, one did not include employers pension contibution (which was nice), (2 be continued)

James
Feb 09 2009 13:30 Report this comment

Both sides are correct here. When you are made an offer you must ask questions. On the other side, companies MUST give you a breakdown of the package. In the Public Service all posts higher than Level 11 (Deputy Director) are advertised on the CTC basis.

VS
Feb 09 2009 12:16 Report this comment

I think companies and agencies should rather market positions against a NETT salary offering per month/year rather than a CTC. The other "levies" should follow as benefits.

rg
Feb 09 2009 11:10 Report this comment

I find the CTC adverts quite annoying to the point of skipping them entirely. It's obvious that there's enormous room for a company to add in imaginary CTC charges (sanitation, office furniture, kitchen supplies etc.) if they want to create a falsely inflated remuneration package.


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