According to the 'Human Capital Survey, on the Impact of Covid-19 on Compensation and What do the Employees Want', the loss of variable pay is pushing a sizable portion of employees to demand a restructuring of the salary with a higher fixed pay even if that reduces the overall CTC.
Respondents said as working from home is the new normal, employers should consider a work-from-home allowance to reduce their employees’ office-related expenses.
It also showed that companies experienced higher attrition among young performers, while lower or stable attrition among mid to senior-level performers.
Overall, 40% employees witnessed a reduction in total pay, and 45% did not see any change in overall pay over the past year.
The impact on remuneration was more pronounced in mid-size companies with less than 1000 employees in sectors like real estate, infrastructure and hospitality. Larger companies in consumer-led sectors, such as consumer, retail and e-commerce, pharma, healthcare and life sciences, showed higher resilience to the adversities.
“While one-third of the respondents experienced a reduction of more than 20% in their fixed pay, 40% did not see any change in fixed pay despite an overall decrease in their earnings. This highlighted that the variable pay component of the salary took a major hit," said Amit Jaiswal, partner, Human Capital Consulting at Grant Thornton Bharat.