Total Employment Cost Calculator (India)

In India, the cost of an employee goes well beyond their CTC. Employers must contribute to several statutory funds and schemes. These contributions are real costs that impact your burn rate and unit economics.

Employee Provident Fund (EPF) — Employer share

3.67% of basic + DA (capped at ₹15,000/month). The employer pays an additional 8.33% to the Employee Pension Scheme (EPS), 0.5% to EDLI, and 0.5% as admin charges — totalling 13% of the PF wage.

Employee State Insurance (ESI)

3.25% of gross wages for employees earning up to ₹21,000/month. Provides medical and disability benefits. Not applicable above the threshold.

Gratuity

4.81% of basic + DA. Payable to employees who have completed 5 years of continuous service. Often provisioned monthly even though it's paid out only on exit.

Bonus (Payment of Bonus Act)

Minimum 8.33% of basic + DA (capped at ₹21,000/month or the actual basic, whichever is lower) for eligible employees. Payable annually.

A common mistake founders make is budgeting only the CTC and ignoring the employer-side statutory costs. For a mid-level employee earning ₹50,000/month gross, the employer's total cost is approximately ₹54,500–57,000/month including PF, ESI, and gratuity — roughly 9–14% above the gross salary.

The employer PF contribution has four components, all calculated on the PF wage (basic + DA, capped at ₹15,000/month):

• EPF contribution: 3.67% of PF wage — goes to the employee's provident fund account.
• EPS contribution: 8.33% of PF wage (capped at ₹15,000) — goes to the Employee Pension Scheme. The employer effectively bears both the EPF and EPS components.
• EDLI contribution: 0.5% of PF wage — Employee Deposit Linked Insurance.
• EPF admin charges: 0.5% of PF wage — administrative fee.

Total employer PF burden is 13% of the PF wage. If basic + DA exceeds ₹15,000/month, the PF employer contribution is capped at ₹1,950/month (13% × ₹15,000).