Fix Fair Salary To Avoid Illegal Issues And Create Salary Structure Xls Download

We are registering our company for retail and wholesale two and three-wheeler spare shops and will be operating from multiple locations in Tamil Nadu.

We are hiring salesmen and need to fix the salary for our employees. Since it is a startup, we need to set a fair salary for employees and consider the company benefits as well.

Tamil Nadu Minimum Wage in rupees per day w.e.f April 1, 2016, to March 31, 2017:

Scheduled Employment = Shops and Commercial Establishments

Basic Minimum Wages = 78.88

V.D.A. = 143.35

Total Minimum Wages = 222.23

1. How to fix a fair salary for salesmen and avoid any legal issues?

2. For the same suggested salary from question 1, how to create a salary structure that offers mutual benefits for employees and the company?

Design a salary structure where the base salary should be very low and incentives (including attendance allowance, food allowance, performance allowance, and transport allowance, etc.).

I conducted some research and created a salary structure; I request you to point out any flaws and suggest a perfect salary structure.

Please be specific about "Other Allowance". Note: Washing Allowance is exempted in ESI. HRA can be 50% of Basic. Also, please note that PF Dept is specific that Basic should be 50% of the gross salary or otherwise they think that we subterfuge the PF contribution.

It is better to have a different salary structure for CTC less than 2.5 Lacs and above 2.5 Lacs. It is advisable to give "Medical Allowance", "Uniform Allowance" & "Book Allowance" to higher salary as "Reimbursement allowances" so that TDS won't attract. LTA is also better for higher salary people.