Trade union leaders oppose government interference in wage settlement

A Government Order passed on July 2 against frequent revisions of pay and allowances of employees of State public sector undertakings (PSUs), on the basis of wage settlements entered into by them and employees under the Industrial Disputes (ID) Act - 1947, has created a furore with trade union leaders demanding immediate withdrawal of the G.O.

In the recent G.O., the Finance Department recalled that a similar order was passed on September 21, 2001, directing the Chief Executive Officers of all PSUs to convince labour unions to agree for the extension of operating period of wage settlement to five years from the present three to four years.

“But some of the State PSUs, like State Transport Corporations, Tamil Nadu Generation and Distribution Corporation (erstwhile TNEB), Tamil Nadu Sugar Corporation, Tamil Nadu Cements Corporation, Tamil Nadu Magnesite Limited and Arasu Rubber Corporation, continue the practice of three or four years,” the G.O. read.

The government also found that some of the State PSUs had adopted pay scales similar to those permissible for government employees on the basis of wage settlements made as a package deal.

Hence, it sought Commissioner of Labour’s opinion and decided to issue new guidelines for pay revision.

As per the guidelines issued on July 2, the PSUs offering pay and allowances on a par with government pay scales should follow the Pay Commission cycle (once in 10 years) for wage settlements under the ID Act.

In so far as all other undertakings were concerned, the periodicity of wage settlement should be between five and 10 years, the guidelines said.

“No budgetary support for wage increase shall be provided by the government... Resources for meeting the increased obligation for implementation of wage revision must be generated internally and must come from improved performance in terms of productivity and profitability,” the G.O stated.

It also clarified that the PSUs operating under an administered price structure should ensure that any increase in wages did not result in increase in the administered prices of their goods and services.

Opposing the G.O., S.Sampath, treasurer, Tamil Nadu State Transport Corporation (TNSTC) Staff Federation, said the prime reason for fixing a short duration for operation of wage settlement in the TNSTC was the increased accident risk for drivers and conductors.

K.Natarajan of Labour Progressive Federation (LPF) said the government had no right to alter wage settlement period fixed on the basis of agreement between the managements and the employees.

K.Arumuga Nainar of Centre of Indian Trade Unions (CITU) said the present G.O. was unacceptable. The issue would be discussed at a meeting called by the CITU in Chennai on July 16, he added.

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