Is a prospective employer deceiving you with inflated CTC

livemint.com:

₹5 lakh worth of insurance payout in its CTC. An outright misrepresentation. A scam, in my opinion.

Employees discover these misrepresentations only after they receive their first salary, and when the credited amount appears only like a shadow of the amount they were expecting. That is the point for them, when the penny literally drops. One way to safeguard yourself from such deceptions is by understanding that CTC contains various costs that a company might spend on you.

Might! CTC may further include costs like insurance premiums, training and development costs, and some companies may even include expenses incurred on office furniture, equipment, and electricity. While these are costs for the company, they may not translate into benefits for you. This plays a crucial role during salary negotiations as companies, through deceitful financial engineering, may increase your CTC without enhancing any real benefits you might receive.

Therefore, the CTC can be deceptive and is not the right metric for you to use when comparing alternative offers or during negotiations with the the human resources (HR) department of companies. To find the right metric, you must look at all the components in your CTC. Understanding these components would also set your expectations right.

CTC is the sum total of direct fixed benefits, indirect benefits, retirement benefits and conditional benefits. Direct fixed benefits are the components that appear on your monthly salary slips. These include basic salary and allowances like special allowances, house rent allowances, etc.