New #PF rule: You may have to re-look #Retirement saving plan

A recent circular about the manner in which the contribution to the Employees Provident Fund will be calculated will have far reaching impact on employees in the days to come. In a nutshell the manner of calculating the base for the application of the rate of deduction of provident fund contribution should include the basic salary, dearness allowance as well as allowances that are ordinarily, necessarily and uniformly paid to employees instead of the basic salary and dearness allowance that is used currently for the calculations. Here are some of the impacts that will be witnessed in the days to come.

 

Additional provident fund contribution:

 

One impact of the implementation of this change will be that the contribution to the Employees Provident Fund will increase on the part of both the employer and the employee. This will happen as the base for the calculation is larger than before due to the increase in the items that are considered as basic wages.  For the employee this will mean that a larger amount gets accumulated in the provident fund account each month which will mean a larger amount of earnings in the form of interest in the coming time period.  This will change the entire dynamics of the retirement planning calculations as this larger amount going towards this area will need adjustments in terms of savings and investments in other areas for the purpose of retirement planning.

 

Change in salary structure:

 

The amount spent by an employer on the employee is known as cost to company and when the change in the manner of provident fund contribution is considered if all other things remain as before then it will lead to a larger contribution from the employer. If the employer decides to absorb this rise then it will in effect be a salary hike for the individual to the extent of the extra amount contributed to the provident fund by the employer. However many employers might prefer to keep the cost to company figure constant by reducing the allowances to the extent that this compensates for the additional amount of contribution to the provident fund. This would lead to changes in the salary structure and in many cases even the manner in which the entire salary is provided.

 

Cash flow:

 

A major impact for the individual will be the cash flow changes that will be witnessed. A larger contribution to the provident fund from the employees side will mean that lesser amount of income will be available as take home salary.  This can put a severe dent in the management of the household budget because the individual will have to adjust their planning in such a way that the lower amount of income is taken into consideration for the various spends. If the employer decides to change the salary structure by reducing the allowances to keep the cost to company figure constant then the hit will be even harder as the income will fall and at the same time contribution will rise leading to a squeeze on the cash flow from both sides. Planning for a reduced take home salary in advance would be required to avoid a sudden shock later on.

 

Overall planning:

 

The overall planning with respect to investments and long term retirement needs will need to undergo a change for the employee. With a larger amount being compulsorily going towards retirement needs the individual might need to shift their overall planning focus to other areas. This could require allocation for other goals like education of children, buying a property, travel etc. There is also the question of the rate of return being earned by the investments and since the interest earned on provident fund is tax free it will be difficult for the investor to get similar rates on the debt side from other instruments. So the allocation towards provident fund would be earning a good rate of return and the remaining funds would need an appropriate asset allocation so that an overall balance in the portfolio is maintained for the employee.

SOURCE – MONEYCONTROL

Terrible Body Language Mistakes That Can Cost Your Job

Most of us dream about getting into a company which is famous all over the world or at least we work hard to get the job we desired right from our college days. You might have also prepared a flawless cover letter and a well prepared resume to apply for the job. But what, is that enough to get a job in your dream company or you desired profession? The answer is ‘No’ because without a proper interaction with the recruiter at the time of interview, it is very difficult to get the job, no matter how well you have presented your covering letter with the resume.

Apart from being a well interactive person, you also need to learn about the body language that you need to carry during the time of the interview. If you present any terrible mistakes regarding your body language during the interview session, then it is for sure you will be under threat of not getting the job. So, to avoid such situations, here are few important body language mistakes that you need to avoid to get hired as it was reported on Forbes Website by Jacquelyn Smith.

1. Appearing weak while greeting the recruiter:

If you are weak while greeting the recruiters at the time of interview, then it can be the biggest mistake you can ever make at the time of the interview because greeting well shows your interest towards the job you have applied and the desperation towards it. The most important thing to do while greeting someone is by shaking your hands with the person you want to greet. So, if you shake the hand in a very weak manner with the recruiter soon after you enter the interview room, it clearly signifies that you are not at all interested in the job and you are attending the interview forcefully. It can become a clear note that you are under threat of not getting that job because of your weak performance during the interview round no matter how good your resume was prepared.

So, to avoid such circumstances, make sure you are firm while greeting someone, especially, while shaking hands with the person you meet. Also see to that you won’t crush the recruiters hand while shaking hand, says Patti Wood, an author and a body language expert.

2. Going too close to the hiring manager:

It is another nonsensical mistake you can do knowingly or unknowingly at the interview room after entering. Talking in a perfect manner with the recruiter is appreciated by one and all, but that doesn’t mean that you need to go close to the recruiter and talk to him or her. It is your duty to be courteous at the time of interview in front of the hiring manager. Sitting or standing too close to the hiring manager might definitely look awkward which can also make them feel uncomfortable.
So, at the time of the interview, do remember that you need to be respectful towards the hiring manager’s personal space at any point of time. It can also harm your chances of getting that job, if you follow the opposite of sitting too close or sitting quite far from them inside the venue of the interview. So, a better maintenance of the space between you and the hiring manager is a good procedure to complete your interview round successfully.

3. Talking to the recruiter with crossed arms:

It feels generous if we respect each and every person we come across in our life. But that doesn’t mean that we need to show it with personal actions such as crossing our arms and sitting or standing in front of them while talking to them. The same applies when you appear for a job interview in any company. In a job interview, the recruiter expects you to talk in a friendly manner with them than considering them as the boss and you as a junior or a fresher. They don’t want you to feel shy at any cost and to make it simpler for you during the interview, they start interacting with you in a friendly manner.

So, to reach their expectations, even you need to start of your talk with them in a friendly manner than struggling to talk to them. At the same time you also need to remember that you sit stiff and comfortably in front of them while interacting than crossing your arms that looks like a defensive manner. Instead of sitting or standing with a crossed arms, try showing hand gestures while you are talking to them which shows your enthusiasm and interest towards the job you are being interviewed.

4. Playing with your hair:

Correcting the hair or playing with your hair looks very awkward especially it makes the hiring manager feel uncomfortable by your silly act. This act shows that you are very careless while giving the interview and you are more caring about your body parts than concentrating on the interview questions you are asked. If you feel that your hair is disturbing you while talking to others, its better you tie it tightly so that it won’t come in front of your face to distract your concentration. Correcting your hair or playing with it while talking to someone also makes you look childish in front of everyone, says Patti Wood.

Make sure you are aware of all your bad habits that can distract your interview with the recruiters beforehand and work out for avoiding those habits. If you feel, those bad habits cannot be ridden immediately, try to start avoiding such habits in front of your friends every day, so that you get rid of those habits from you as soon as possible.
5. No Proper Eye Contact:

A proper-eye contact with the recruiter you are talking will be considered as you are confident about what you are talking. Without a proper eye-contact, it will be regarded as that you feel shy while interacting with others. Most of the candidates will do the mistake of not interacting with the recruiters with a proper eye-contact.

Patti Wood is of the opinion that, it is fine if you as the candidate look across your surrounding while talking to the recruiters, as you will be accessing different parts of your brain by moving your eyes to get a proper answer for the question that has been asked. But you need to be very much attentive whenever the recruiter is talking to you and listen what they say properly to avoid any complications in the future. You shouldn’t forget the fact that a proper eye contact acts like a connection tool between the people who are talking to each other, so never go wrong in this matter at any time.

8 Things Not to Do in Your First 3 Months on the Job

After on boarding a new organization it is very important for professionals to keep in mind that he/she should give his/her level best in order to create a good impression at their new job. Remember that for the first ninety days of your joining, everyone has an eye on you to find out that whether you are a good hire or not, suggests Stacey Hawley, Principal at Credo, a career services company, reports Ritika Trikha on Career Bliss.

Therefore, one should be very careful after on boarding a new organization and avoid spoiling their trustworthiness. Listed below are eight things to avoid doing after joining the organization suggested by seasoned experts.

1. Never say ‘That’s not my Job’ : Most jobs in today’s corporate world requires to change the job duties of professionals in no time, therefore, you should be flexible in order to take up any work,  if you deny to take up new duties that shows you are not a team player , according to  Yung Trang, President of TechBargains.com. Yung Trang suggests professionals to ready to extend support whenever you are needed as you will be always remembered by your company superiors for this good quality of yours, no matter what you do later.

2. Never behave as if you know everything: It is always advisable for you to be an observer after jo ining the organization, no matter how qualified and skillful you are, you should carefully see how things work in that organization, moreover, you should observe the work culture and the employees working in the organization instead of giving your own suggestions, so that they can do things differently, claims Stacy Pursell, executive search consultant of the Pursell Group.

3. Don’t be Unsocial: You should definitely know that being unsocial will keep you from integrating into the company’s family. Building a good rapport with the people in the organization will prove to be one advantage for you in the long run, therefore, never say no to lunch invitations or company functions. According to Rachel Dotson, Communications Manager at Zip Recruiter, you should not hesitate to mix well with the people in the organization, which will enable you to bridge the gap between you and them, as people are less likely to respond to their new co- workers.

4. Do not take vacations immediately after joining: If you take up a vacation immediately after join ing the organization, it will be difficult for you to settle down there. Taking vacations immediately won’t prove to be a wise decision as by this you are sure to annoy your employers. Yung Trang says that if you have already planned your vacation before joining the organization, you should let your employer know about that beforehand as a condition of accepting the job offer.

5. Do not get involved in surfing the social networking sites: Even if you don’t have much wor k immediately after joining the organization, never, ever think of spending your time surfing the social networking sites as this is sure to annoy your employers. No employer will tolerate that they are paying an employee for time wasting and surfing the social networking sites, suggests Hunter Valmont, President of Hunter Valmont PR.

6. Never get indulged with office Gossip: Many of your co – workers would like you to get invo lved in office gossips, and in order to be liked by them you may commit the mistake of getting involved with the office gossips and politics which may lead to your departure from the office soon, says Roberta Matuson, president of Human Resource Solutions

7. Don’t lie about a mistake done by you: Remember that mistakes can be committed by anyone, e specially if you are a new comer it is acceptable by your employers that you can commit errors, however, you should not lie to your employers if you have committed any mistake as this will give them a reason to mistrust you, according to President and CEO of LaSalle Network Tom Gimbel.

8. Avoid saying ‘I’ instead of ‘We’: Employers like professionals with team spirit, therefore, as a new employee you should never decline to demonstrate your team spirit to them. So use ‘We’ instead of ‘I’ in every possible sentence. Moreover, you are required to work in a team environment in the organization. So even if most of the contributions regarding the productivity of the business are done by you, never in any conversation with your company superiors say that “I did this”, says Samantha Goldberg, celebrity event designer-spokesperson, television personality and experienced manager/trainer.

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Is Company’s Culture More Important to Select a Job?

It is pretty difficult to get a job at this time as the competition has increased in a rapid way than before. At present, jobs seekers are in the dual mind, whether to go for a job which offers them more salary or to choose a better place to work where the company’s cultural atmosphere is well established.

You might have experienced this situation before you got into a job. You must have experienced confusion while you were been offered many job offers at a time because each company had its own advantages and drawbacks.

As the companies are aware of the fact that it is their company’s culture which depends on the overall success of the company, they have given equal prominence to build a healthy working atmosphere along with their daily business activities.

There are people who give more prominence to their money rather than the company’s cultural atmosphere. They don’t bother whether their company is a good place to work or not, they will be just interested in their pay for their work and they are also least bothered about the type of colleagues they have next to them.

At the same time there are people who get to know about the company’s poor cultural atmosphere at the time of the interview by the way the interviewers speak. Some of the interviewers seem very harsh and strict by which many candidates drop the hope of joining that company. Many of them calculate pros and cons before joining a company, like there are few who see the travelling distance from their home to the workplace even though they are paid well. But there are very few people who search a job that is next door because at the present day situation, where finding a job is very difficult, people have very less interest in concentrating on job offers which are of total convenience to them. To have a career growth, people at present, are compromising regarding any issues that are related to their career.

Nowadays, the employees at every office are given equal prominence by the HR Departments of their respective companies. The employees are free to share any problems related to their workplace and get it solved. Like this there are many facilities given to the employees to increase their productivity at their work.

So, what is your take, will you work for a company which is culturally well established or are you more concentrated on the high pay offer given by companies which has poor cultural atmosphere?

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10 Must-Know Factors About An Employment Contract

An Employment Agreement is a tricky thing and needs to be handled cautiously. Every candidate must read an employment agreement thoroughly and understand all aspects of it before signing it. Hidden clauses or loopholes in an agreement can cost an employee a lot and can even adversely affect his/her career. Here are a few factors one must keep in mind while agreeing to the terms of a contract.

1) Pay Package and Perks:

The first thing a new joiner thinks about his/ her job is the salary or the pay-package. After all, monetary gain is one of the essentials of a job, though not the only one. Thus, it becomes exceedingly important for an employee to thoroughly clarify all doubts pertaining to this aspect. An employment agreement should clearly mention the basic pay, deductions and perks of an employee. It is advisable to have all information regarding pay in a written form in order to avoid discrepancies in the future. Pay based on performance or meeting targets should also be mentioned in the employment contract. One should also clarify the mode and date of payment of salary.

2) Job Description, Duties and Reporting System:

An ‘employee-to-be’ should mandatorily ask about his job roles, duties, responsibilities and tasks before signing a contract. It is of utmost importance that a person understands what is expected of him/ her because failure to understand job roles can have hazardous effects on both, the employee and the organization. If one does not fully comprehend the job roles, one might get frustrated, irritated, error prone, display poor performance at work, depressed and can even be suicidal. The adverse effects of a job not well understood are many because if one does not like his job, he will never be happy with it.

3) Presence of a Bond:

This is one of the ways an organization checks its attrition rate. By depositing a fixed amount of money, decided entirely by the company, a new employee is bound to work in the organization. If the employee exits the company before the stipulated period, he/ she will not get back the deposited amount. This is a sure-fire way of checking employee turnover. This is not a mandatory clause in all organizations because depositing money acts as a deterrent for new employees. Usually, public sector organizations have such a clause. An employee must carefully think over whether he/ she is comfortable with this aspect of the contract. Any hesitation in this aspect, one should rethink joining the organization.

4) Non-disclosure Agreement:

This agreement basically talks about how an employee of an organization should not disclose any inside information regarding the organization to any external agent. In case of breach of contract in this regard, it can lead to serious consequences and can even culminate into a lawsuit. One should keep all office information tightly locked up within the four walls of the office. One exception in this case can be the reporting of wrong-doings or misconduct on the part of any employee, which is also called whistle-blowing. This should be done only in grave cases and not minor ones.

5) Period of Probation:

All employees of an organization go through this as the concerned organization needs to test the new joiner to see if he/ she is fit to work in the company. This, usually, is a wary phase because many organizations mention as to how an employee under the probation period can be terminated without prior notice and also pay. An employee must be comfortable with the length of his/ her probation period before joining. Employees must work harder during this period and steer clear of any activity that might jeopardize their employment. This period, though full of road-bumps, is a good learning time for all new joiners as employees learn all aspects of their workplace.

6) Policy of Leave:

Another thing that new employees literally die for is leave. One can never be sure of a workaholic, but most employees literally go ‘TGIF’ (Thank God It’s Friday) on Fridays. Apart from regular leave (usually weekends), employees under the probation period are usually not given any day off, except for sick-leave.  Even casual leave is not allowed during this period. After completion of probation period, all employees of an organization are entitled to various types of leaves. One must also keep a check on the holidays one can carry forward to the next year and which ones to encash in the same working year.

7) Termination Provision:

This is, perhaps, the gravest of the clauses in an employment agreement. This clause is one that no employee can fully understand or completely evade. This is entirely decided by the concerned organization as to who it wants to remove. Various organizations mention the procedure of termination and what exactly to pay the terminated employee. Sometimes, organizations can terminate employees without prior notice and also pay. This, too, is mentioned in employment agreements. It is always better to clarify with the head of the organization as to why one has been terminated. This helps an employee to stave off the reasons instrumental in his/ her termination in the future.

8) Intellectual Property:

Intellectual Property (IP) includes – Patents, Trademarks, Copyrights, Trade Secrets and the like. IP usually pertains to organizations that are associated with inventions and creations. Various forms of art also fall under this category. Many organizations give their employees the freedom to come up with their inventions but reserve the rights of using the inventions only for the concerned organization. An employee working in such an organization should be able to face the fact that the credit of his/ her invention will not be attributed to him/ her. This is something an employee of such an organization must understand and accept. One can also look at this from the angle of working for the greater good.

9) Non-solicitation Clause:

This is also called the Covenant Not to Compete. This clause talks of how an employee is barred from joining certain organizations after leaving the organization. This, again, is not a mandatory clause and differs from company to company. Here, the employee who exits the company is barred from working in rival companies. This is one of the ways to keep competition at a low level because after completion of probation period, an employee can opt to work in another similar firm. This can be with respect to either or both, company clients and other rival companies. Hence, one can try and keep away from companies which stress upon such a clause as it might be detrimental for one’s career.

10) Moonlighting:

This clause talks about whether employees of an organization are allowed to have more than one job or not. This usually pertains to companies which offer part-time job but might also hold true for other organizations. One should not keep the fact of working in another organization from the company in which one is working. This can lead to breach of contract and even serious consequences. It is always better to clarify all doubts pertaining to this aspect for one must never be dishonest with the place that helps a person earn his bread.

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5 Financial Things To Consider While Switching Jobs

Financial security is always an issue when beginning something new and leaving something old. Changing jobs or your entire career is an exciting, and possibly frightening journey. It is not just about getting a higher salary, but rather about many things that can affect your financial situation in the long run. Leaving a job is a major financial consideration, no matter how it is done. It is a good idea to review your personal finances and figure out how you will be impacted by the change in your employment.

A careful planning and following a financial checklist before you change a job can give you all the benefits of the change and more:

Insurance

If your current employer was offering you and your family life and health insurance coverage, compare it with the health insurance provided by new employer. Do not remain uninsured during the transition period from one job to another. Emergency situation can occur anytime. Be prepared to face it. Your family shouldn’t be at risk because of your ignorance. Check for the insurance benefits you will be eligible for at your new job and whether you will have to serve for a minimum few months before your coverage starts.

Employees Provident Fund

Switching jobs suggests two ways of dealing with employees provident fund corpus. You could either transfer your existing account to the new employer or close the old account and open a new account. Something you need to consider is that, the duration for opening a new account can take 3 to 6 months. In addition, you would be left with a smaller retirement corpus because you would lose on the advantages of your corpus compounding. If you withdraw before five years you will have to pay taxes. Therefore consider transferring the corpus rather than withdrawing, as it would give you better tax benefit and retirement benefit.

Tax computation

Tax liability and exemptions form an important consideration while switching jobs. Most employers would be computing employees’ tax liability after taking into consideration the basic exemption limit of Rs 1.8 Lakh and also the exemption availed under Section 80C. You need to take form-16 from both employers. Remember to also take a no dues certificate, relieving letter, salary slips for the duration you have stayed. Clearly mention the income earned from your previous employer for that financial year to your new employer. This makes sure you are not taxed twice nor you receive the benefit twice. If you fail to do so, you would have to pay penalty for non-payment of advance tax.

Employee Share Ownership Plan

ESOP is nothing but an option to buy the company’s share at a certain price. This could either be at the market price or at a preferential price. When you invest in shares, you do not invest in the market. You invest in the equity shares of a company. That makes you a shareholder or part owner in the company. There are time limits for availing this scheme. For instance, you can acquire the shares after you complete a particular period of employment. This could be a year, even longer. If you quit your job before this period is complete, the stock options lapse. The ESOP is not taxed on acquiring the shares. You are taxed on the profit you make when you sell the shares or transfer them.

Review your retirement plan

Based on the terms of your employment in your previous workplace, you will be eligible for gratuity, superannuation and other similar retirement benefits. Some schemes can be carried over to the next company and some other schemes need to be encashed when you quit your job. You need to pay attention to the details of these schemes before quitting your job.

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World’s Most Hardworking Nations: India 7th

A new survey conducted by Ipsos Global and Reuters found that Indiaranked as one of the most hardworking countries in the world. The survey says that full-time workers in most countries get paid holidays, apart from Sundays and Saturdays too. Ipsos Global and Reuters survey on 13,000 people across various countries checked the likelihood of employees using all their vacation days, reports rediff Business.

 Here is the list of top 10 hard working nations in the World

Japan

Japan has been ranked as the most hardworking nation in the world in terms of its full-time workers using their allotted paid holidays. There is only 33 percent of the employees avail of their allotted paid holidays. They get 16 public holidays and work about 1,714 hours per year on an average.

Australia

Australia comes at number second as only 47 percent Australian workers take all their allotted vacation days. They get 8 federal holidays off, and they work an average of 1,690 hours per year.

South Africa

With only 47 percent Australian workers take all their allotted vacation days, they are in third position. Australians get 8 federal holidays off, and they work an average of 1,690 hours per year.

South Korea

The people of South Korea get 15 public holidays and only 53 percent of the employees take all their allotted vacation days.

The United States

In U.S. there are 10 government or public holidays and only 57 percent of people take all their allotted vacation days. Employees in U.S work 1,768 hours per year on an average.

Canada

In Canada, only 58 per cent of the employed people take all their allotted holidays and they get only 9 federal holidays per year. Canadians work an average of 1,699 hours per year.

India

The sincerity and hard-work put in by Indians has enhanced the nation’s visibility on the global map as being the 7th most hardworking country. Indians get 16 government holidays, and employers are required to give only 12 paid holidays. Only 58.5 percent of employees take all their allotted holidays.

Brazil

In Brazil, there are 11 federal holidays, and employers are required to offer 30 additional vacation days. But only 59 percent Brazilian employees take all their allotted holidays.

Sweden

In Swede, the employees get 11 government holidays in a year, and work about 1,610 hours per year on an average and only 63 percent of people take all their allotted vacation days.

China

In China there are 11 government holidays, and any organizations have to give at least 10 vacation days to employees. In China 65 percent of employees take all their allotted vacation days.

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