Recently, there is a re-packaging of all the contract staff salary. All contract staff can choose to take up the new repackaged salary or continue with the existing package.
Basically, it is just to take 1 month of our variable bonus which we will get at the end of the contract and distribute to our monthly pay.
They came up with a formula to calculate the new adjusted salary. They took the assumption that our variable bonus is going to be 2.5mths (which is usually slighly higher)
New Salary = Current Salary * ( 12 + 1 + 2.5) mths / (12 + 1 + 1.5)
12 is for the 12mth a year.
1 is for the AWS.
The idea is, after adjusting the salary, the annual salary is still going to be more or less the same.
Assume Current Salary = 1800 (not mine lah, just an example)
Current Salary * ( 12 + 1 + 2.5) mths / (12 + 1 + 1.5)
= 1800 * 15.5 / 14.5
So the new salary will be 1925
So end of the year, instead of 2.5 mth vb, you will get 1.5.
Annual salary without the repackaging
1800 * (12 + 1 + 2.5) = 27900
Annual salary with the repackaging
1925 * (12 + 1 + 1.5) = 27912.5
The different is only $12.5.
But that is based on the assumption that you will get 2.5mth bonus. If you get higher bonus, the diff will be bigger. Lets assume VB is 3mth.
Without repackaging = 1800 * (12+1+3) = 28800
With repackaging = 1925 * (12+1+2) = 28875
A $75 different if you choose to take up the repackaged salary.
Of cause, if the VB is less than the 2.5, we will lose out. But the thing is, only those who perform badly will get less than 2.5 mth VB.
Conclusion.... No harm taking up the new pacakge.
(ok, you all understand what I talking?)