Step 1: Guaranteed monthly cash
Add:
- Basic salary
- Fixed housing allowance
- Fixed transport allowance
- Other guaranteed monthly cash
Do not include a discretionary bonus or uncertain commission in the amount available for monthly living costs.
Step 2: Annual guaranteed value
Multiply guaranteed monthly cash by 12, then add guaranteed annual payments. If housing, transport or schooling is provided directly, estimate its value separately and label the estimate clearly.
Step 3: Risk-adjust variable compensation
Ask what percentage of comparable employees received target bonus or commission last year. Model at least three scenarios:
- Zero variable pay
- Expected realistic pay
- Target or maximum pay
An “up to” figure is not guaranteed compensation.
Step 4: Price major benefits
Record:
- Medical cover for employee and dependants
- Annual flights
- School allowance
- Employer accommodation
- Car, fuel, parking or transport
- Relocation support
- Joining bonus
- Paid leave beyond the baseline
Avoid giving a benefit its retail price if you would not otherwise buy it.
Step 5: Examine the basic-salary split
The basic figure can affect calculations such as traditional end-of-service gratuity and covered overtime. Read basic salary versus total salary and how basic salary affects gratuity.
Step 6: Adjust for working time
Estimate actual weekly hours, working days and commute. Compare effective compensation per working hour:
Guaranteed annual cash ÷ realistic annual working hours
This is not a legal overtime calculation. It is a decision tool for comparing offers with different demands.
Step 7: Stress-test the package
Could you still accept if:
- The bonus is zero?
- The promised raise does not happen?
- Housing costs increase?
- A dependant is excluded from insurance?
- The commute is longer than expected?
A resilient offer works under a conservative scenario.
Compare with real market evidence
A calculator can organize an offer; it cannot determine market fairness without comparable data.