Can an Employer deduct Gratuity & Dress Expenses from CTC of the Employee

[Anil Roy]

Dear All.

I have a basic quary regarding Salary of a Employee. The case is "our employer prop[osed to pay salary as follows":

Basic      10589.00

HRA            7943.00

Conveyance  7943.00

Gross26475.00

Leave Pay  1470.00

Bonus     700.00

Dress60.00

Gratuity      463.00

Total CTC 29168.00

 

My quastion is "can our employer deduct Gratuity & Dress from our CTC or not, please confirm.

 

Regards,

Anil Roy

[Deepak Nagori]

Yes Anil,

Various companies do include Gratuity in the CTC of the employee as it reflects the provision made for gratuity to be paid to the employee, should he retire/resign after 5 years of service. As far as dress is concerned, it does not seem appropriate to deduct it from salary as it is given for performance of official duties (if I am not mistaken).

Regards

CA Deepak Nagori

AI Summary

Gratuity inclusion in CTC may be permitted as a provision; dress allowance deduction from salary is generally inappropriate.
Gratuity is commonly included in CTC as a provision reflecting employer liability to pay gratuity on qualifying separation, while dress allowance paid for official duties is not appropriately treated as a deductive item from salary but as an employment-related allowance.