HR & payroll glossary

What is Gross salary?

Gross salary is the total of all earnings paid to an employee in a period, before any deductions such as PF, ESI, PT or TDS.

Definition

Gross salary covers basic pay, HRA, special and other allowances, overtime and any other earnings for the period. It is the base for ESI eligibility and contributions, and the starting point for computing net pay.

How it works

Gross = sum of all earning components for the month, after loss-of-pay adjustments.
Employer contributions (for example employer PF) are not part of gross; they sit in CTC.
ESI applicability is tested on gross wages, not on CTC.

Why HR and payroll teams care

Whether an allowance counts in gross decides ESI coverage and can affect PF and bonus. Structures should be designed with those tests in mind.

Example

Monthly earnings

Basic ₹30,000 + HRA ₹15,000 + Special allowance ₹20,000 = Gross ₹65,000

Gross salary in NeevHR

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