You need to know the difference between your Total Cost to Company, your Basic/Cash component and your Neta as well as the Gross salary. These are all different from each other and can't be confused as the same thing when referring to 2 of these mentioned together.
Before accepting an offer of employment, you need to be informed and fully understand what your monetary breakdown is so that you do not make a loss, even if you are unaware of making a loss when you move. Some benefits are not cash benefits and are benefits directly paid by the company. Money which you never see, nevertheless, it is money paid on your behalf, that you do not pay directly yourself, therefore it becomes a benefit to you. You can get cash and non-cash benefits. For example - a housing allowance given to you as a monetary value each month is a cash benefit and would usually reflect on your payslip. However, if given company housing, this is a non-cash benefit as the company pays for that housing and this won't be reflected on your payslip as it is not something the company is paying to you in cash. Under the 'deductions' section of your payslip, there may be deductions for water and electricity, but this has nothing to do with this benefits and is not part of your cost to company.
Your 'Basic Salary' or ' Cash component' is the salary amount paid to you before you get any additional benefits from the employer such as medical aid, pension, and various allowances which are added in over and above this amount. So, your basic salary is the part of your salary that is a fixed amount every month. This amount does not include overtime pay and any bonuses or 13th cheques etc.
These are your total earnings. This term is used to calculate the total cost to the company to employ you. i.e. all the costs the company has to make associated with your employment contract. The cost to company has nothing to do with your deductions. If your employer offers medical aid and your MA benefit each month is R 2000 where they pay 60% of this, and you contribute 40% of this figure, then the R 1200 (60% of R 2000) paid by the employer, will be part of the cost to company and has nothing to do with the R 800 (40% of R2000) that is your deduction/contribution as well.
Your 'Net Salary' is what is left of your salary after all deductions have been made as well as for PAYE (Pay as your earn - in S.A) (tax), UIF (Unemployment Insurance Fund - in S.A) etc. This is also the amount that is paid into your bank account on a monthly basis. In certain cases, you may have other deductions if you have taken out a loan or bond re-payments and these may be deducted after the neta salary is calculated. So the salary paid into your bank account would be your neta salary less these repayments. Neta salary is also referred to as “take home pay” – the money in your pocket at the end of the month.
In some strange cases, one may see a figure on their payslip that says 'Total Package' but it is not logical figure when one adds up everything one would think contribute to a 'Total Package' they see on their payslip. One company for example labels the candidate's 'Total Package' as the following: Basic salary plus Pension, plus Medical Aid plus Housing Allowance even though there are other benefits that are offered as well.
One thing to note is that not all payslips/ salary slips are the same and not every company understands these components to be defined like we have defined them as mentioned above. Where you are unsure of your earnings, go to HR and ask them to give you a clear breakdown of your contributions and the company's contributions.
It is vitally important to really understand what you are earning is detail before being interviewed for a job position. You may get a salary increase that looks pretty good, only to figure out later that you are travelling further distances and your increase in essence is something you are now paying as your own overhead in petrol. You must always ask for a dummy payslip if given an offer to understand the total breakdown of the salary on offer and see what you are going to be netaing as when all is said and done, this is the most important piece of information to base your decision on when specifically comparing apples with apples.
Cost to Company is the amount that an employer will spend on an employee in a particular year, whereas, gross salary is the amount an employee receives as a salary, before any deductions. A gross salary will not include the contributions to the Provident fund or gratuity, among other things. For example: A Provident Fund contribution from the employer is not included in the gross salary. This is a non-cash benefit that the employee will not receive as part of their salary, however it will eventually be paid out and therefore a cost to the company. There can be other non-cash benefits such as a company house. This is not a physical cash pay-out to the employee is some cases, but the employer is covering this cost. Therefore, it is not part of the gross salary received each month, but nonetheless, a benefit received and part of the cost to company. Where an employee get a physical subsidy as a housing allowance where they can use this towards their accommodation, that will be part of the gross salary as it is salary paid out each month.
Where an employee earns commission that could cause one’s earning to fluctuate each month, the gross pay will then differ from month to month, as the gross salary is the total amount an employee receives as a salary before any deductions each month.
When working out one’s earnings, it is very important to work out the annual cost to company and when moving jobs, to refer to the cost to company when negotiating one’s salary, not the gross salary. However, where benefits currently received are not benefits one can consider when moving, this should not be a make or break to accepting a new offer. For example: If receiving a “Remote Allowance” for working in a very rural area at the current employer, where inconvenient and cover expenses for when one needs to travel far distances when going home once a month, this is not something one can expect the next employer to cover if based in the city. If is a situational benefit awarded and the basis of circumstances. Another example could be a travel allowance. If moving to a job where one won’t be travelling at all and purely office based, it is not a benefit one should demand to receive on the basis of current earnings. If not required to fulfil the job function at the expense of the company, it would fall away in most cases