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All HR terms

HR TERMS, EXPLAINED

Variable Pay

The part of pay that changes with performance, targets or company results. It is paid only if the goals are met.

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Variable Pay

In simple words: Variable pay is the part of salary that isn’t fixed. It changes depending on performance, targets or company results. If the goals are met, it’s paid. If not, it may be lower or not paid at all.

Example: Neha’s yearly package is ₹6,00,000, of which ₹50,000 is variable. If she meets her sales targets, she gets the full ₹50,000. If she meets only part, she may get less.

Why it matters: When you look at an offer, check how much of the CTC is fixed and how much is variable. A big variable part means a smaller guaranteed monthly income.

Definitions are general guidance. Your organisation's policies and applicable local requirements determine how a term is used in practice.

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