PSU employees await pay bonanza
While the Govt had said it would implement the recommendations of the M Jagannadha Rao committee by Dec 31, executives were expecting decision by Diwali this year, a date unlikely to be met.business Updated: Sep 25, 2008 21:01 IST
Public sector undertaking employees might have to wait a little longer for a pay bonanza.
While the government had said it would implement the recommendations of the M Jagannadha Rao committee by December 31, executives were expecting decision by Diwali this year, a date unlikely to be met.
The committee, which had submitted its report in May, had recommended a hike ranging between 25 and 45 per cent for 2.5 lakh officers of over 200 central government-owned companies. The compensation packages of the remaining 14-lakh CPSU employees were to be worked out after the seventh round of negotiations with employees unions.
Several public sector firms are not in favour of the structure of the performance related pay recommended by the committee.
Besides fixed pay, the committee has recommended payment of performance related pay subject to a maximum of 5 per cent of the pre-tax profit.
“Performance based payment has been proposed having linkage only with percentage of profit without considering the value addition by employees, return on capital employed and incremental profit,” an executive of leading state-owned engineering firm said.
It has also recommended restricting total additional payout on account of salaries, perks and allowances to its employees within a ceiling of 20 per cent of pre-tax profit.“This ignores aspects such as business performance and growth in profitability,” he said.The panel has recommended that effective date for new scales and allowances be fixed as January 1, 2007.
The committee’s has recommendation to divide companies into five categories depending upon the turnover, manpower and geographical spread has also not found favour with the government-owned firms.