Normal Remuneration vs Additional Remuneration

“Normal Remuneration” means monthly remuneration paid to an employee whether the amount is fixed or variable as stated in the employment contract written or otherwise.

If the employee has no salary and only receives a commission, the commission paid is considered as remuneration.

If the monthly salary is paid on a daily or hourly basis, the total monthly salary paid is considered as remuneration.

If the monthly salary changes due to the change in currency values, the total monthly salary paid is also considered as remuneration.

Overtime allowance, allowances (variable amount paid monthly) and commission (variable amount paid monthly) are categorised as normal remuneration.

Only allowance and commission which not paid monthly are categorised as additional remuneration.

Additional Remuneration

“Additional Remuneration” means any payment paid to an employee either in one lump sum or periodical or in arrears or non fixed payment or any additional payment to a current month’s normal remuneration.

Such additional remuneration includes:

1. i. bonus/incentive
2. ii. arrears of salary or any other arrears paid to an employee
3. iii. employee‟s share option scheme (if employee opts for MTD deduction)
4. iv. tax borne by employer
5. v. gratuity
6. vi. compensation for loss of employment
7. vii. ex-gratia
8. viii. director's fee (not paid monthly)
9. ix. commissions (not paid monthly)
10. x. allowances (not paid monthly)
11. xi. any other payment in addition to normal remuneration for current month

Ex-Gratia means a payment made by an employer "gratis" at his/her own discretion and under no obligation of any law. Ex-gratia is not part of the salary rather it is a form of incentive. It is given by the employer to an employee either as gratitude for his/her good performance, or compensation or of free will when the company is making profits. For instance, a company conducting layoffs may make an ex-gratia payment to the affected employees that is greater than the statutory payment required by the law.

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Edited by: 浪子

Bibliography

Normal Remuneration vs Addition Remuneration. (n.d). Retrieved from
http://www.millionsystem.com.my/article.php?id=37

Legalities of Ex-gratia Payments. (n.d). Retrieved from 
https://paycheck.in/labour-law-india/work-and-wages/salary-wages/legalities-of-ex-gratia-payments

Ex Gratia. (n.d). Retrieved from https://en.wikipedia.org/wiki/Ex_gratia