Differential salary compensation mooted
Suggests merger of 50 p.c. DA into basic pay
Recommends extending retirement age to 62 years
NEW DELHI: The Standing Conference of Public Enterprises (SCOPE), a representative body of State-run firms, on Wednesday demanded that the government should give more autonomy to the board of directors to fix wages for employees to check attrition.
SCOPE has presented a report on “Compensation management practices in public sector enterprises” to the Second Pay Revision Committee on July 24, SCOPE Chairman, Sarthak Behuria, told reporters. Mr. Behruai said the board of directors of an organisation had immense power in all matters, like investment, expansion, production, distribution, but no power at all regarding pay scales. The PSU boards should be given more power and autonomy to fix wages for their staff, he added. Empowered boards will help in retaining talent and fighting growing attrition by introducing performance-based compensations among employees, which is alarming at the management level and in employees engaged in core and critical functions to businesses of PSUs, he said.
He suggested that the salary level of PSUs be based on factors such as capacity to pay each individual PSE, relevant market benchmark for pay and benefits and team and individual performances. The rate of progression of salaries in PSUs is gradual and the ratio between the entry-level executives’ salary and that of the CEO is about 1:4.
SCOPE has recommended the need for differential salary compensation linked to the role of the employee and responsibility, particularly for employees with technical expertise. Two other important measures that SCOPE suggested are merger of 50 per cent dearness allowance (DA) into basic pay and extending the retirement age to 62 years.