Organizations pay salaries to their employees in exchange for the services they provide. The various parts of the salary structure are referred to as salary components.

The payment given to employees includes various parts like basic salary, allowances, arrears, and more. StrideERP enables you to define these different parts, which are called Salary Components, and also specify their specific characteristics.

1. Pre-requisite

• Employee

2. How to create a Salary Component

To Access Salary component go to:

People > Payroll > Salary Component

3. Features

Apart from the above mentioned mandatory fields, some of the additional features of the Salary Component are given below:

3.1 Additional Properties

Some of the additional attributes of the Salary Component that can be enabled using checkboxes are as follows:

• Is Payable: Select this if the Salary Component is payable.
• Depends on Payment Days: If this checkbox is enabled then the Salary Component will be calculated ba sed on the number of working days.
• Round to the Nearest Integer: Selecting this checkbox allows you to round the amount of this Salary Component to the nearest integer.
• Statistical Component: If selected, the value specified or calculated in this component will not con tribute to the earnings or deductions. However, it's value can be referenced by other components that can be added or deducted. If you set a Salary Component as a Statistical component, then you do not have to set the Default Account for the same. Also, you would not be able to set this component as a Flexible Benefit.
• Do Not Include in Total: Selecting this checkbox ensures that the Salary Component is not included in the Total Salary. It is used to define the component which is part of the CTC but not payable (e.g. Usage of Company Cars).
• Disabled: This checkbox can be selected to disable this Salary Component. A disabled Salary Component cannot be used in the Salary Structure.

3.2 Condition and Formula

This section lets you define how to calculate a Salary Component by setting a Condition and Formula. If you want to use a formula, just check the 'Amount based on formula' box.

In case the Salary Component is based on a pre-defined amount, StrideERP allows you to directly enter the amount in the Amount field (disable the 'Amount based on formula' checkbox).

Note: This above setup is optional. You can define Amount and Formula/Condition for a Salary Component directly in the Salary Structure also. If they are specified in the Salary Component document itself, the information will be directly fetched in the Salary Structure when the Component is selected.

3.3 Flexible Benefits

If the Salary Component is considered an Earning Component, this section will appear. Employers offer a range of benefit programs, such as health insurance, pensions, or phone expenses, which allow employees to choose the ones they need. To make a Salary Component a Flexible Benefit, select the 'Is Flexible Benefit' checkbox.

Enter the maximum yearly amount for this flexible benefit in the 'Max Benefit Amount (Yearly)' field. Some of the additional attributes of the Flexible Benefits that can be enabled using checkboxes are as follows:

• Pay Against Benefit Claim: Enable this checkbox if you want to pay this benefit via the Employee Benefit Claim
• Create Separate Payment Entry Against Benefit Claim: If this checkbox is checked, it will let you create a separate payment entry against the Benefit Claim