FinMin for cost-to-company pay structure in state-owned banks | Business Standard

FinMin for cost-to-company pay structure in state-owned banks | Business Standard

The next wage settlement in banking industry will have to factor in, among other things, the following ground level realities: i) After the introduction of New Pension System (NPS), there are two categories of employees in banks. The claims of employees covered by NPS for higher wages factoring in the reduction in real wages on account of subscription to NPS and the need to save more to ensure income comparable to the pension available to the employees who joined earlier than them are genuine. ii) Industry parity. Workmen staff/Officers doing similar work in different categories of banks will have to be given comparable wages, additional compensation being provided for extra work. iii) Outsourcing. Let us not forget Maruti experience. Employees who are on regular employment of banks, even on contract, will have to be given clarity about their absorption in the institutions and a living wage till then. Circumventing labour laws is not in the long term interest of industry. iv) Institutions will have to revisit the recruitment policy (right from basic qualifications needed), career progression (traditional path is no more relevant or practical) and placement policy (rural posting, need for special skills etc.) Like New Pension Scheme which has dismantled an existing social security system which was available to a small section of government and public sector employees without providing an acceptable transparent substitute, here again, it looks, GOI is planning to stealthily destabilise the wage structure in banking sector. There is no denying that ‘Cost to Company’(CTC) is an aspect that should be transparently packaged in any wage policy. But asking one category of employers(public sector banks) with whom GOI has a master-servant relationship to come out with ‘views’ on the concept makes one suspect the motives. Public sector, if backed with a level playing field as compared to the private sector, right from the Board Room to the junior-most functionary, will function much more efficiently than many of the private sector organisations in India, which, by and large, concentrate on the creamy layer of industrial and financial sector activities. Let us not forget that the civil services, executives and staff of public/private sector undertakings have to supplement the skills of the increasing number of political masters who were not as fortunate to get trained or groomed. The nation is immensely dependent on them for carrying out the development agenda on hand. There is a governance and ethical issue hovering around the remuneration structure across government, public and private sectors and the unorganized sector in India. Time for a National Commission on Remuneration Practices has come. The Commission should go into the adequacy of wages, minimum and maximum remuneration across sectors, their relationship to lifestyle needs of employees and paying capacity of employers and the need to factor in social security needs like healthcare and old age needs in wages. M G Warrier, Thiruvananthapuram


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