Tarun Reflex

Thursday, September 18, 2008

Sixth Pay Commission | Update from Nagaland

Nagaland Chief Minister Neiphiu handed over to the PM a joint memorandum signed by all the chief ministers of NE states, asking the central government to bear the entire additional burden on account of pay revision of State government employees, which will be necessitated consequent upon the release of the 6th pay Commission’s pay scales to central government employees.

The CM later attended the meting of State Finance Ministers with the 13th Finance Commission at Vighyan Bhavan on the 16. He highlighted the special status enjoyed by Nagaland under 16 Point Agreement 1960, and article 371(A) of the constitution, and requested the 13th Finance Commission to note it while recommending the revenue-gap grants entitled to the state. He also requested them to take into account the implications of the new pay-scale that may be given to the state employees on the pattern of Central pay-scales of the 6th Pay Commission.

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Sixth Pay commission|Let’s not demoralise defence forces

Prior to the appointment of a Sixth Central Pay Commission (CPC) for better pay scales for Central Government employees including the defence services, the three Services chiefs had asked the Government for a separate Pay Commission for defence services. The reason: there are different service conditions, which have not been appreciated by the previous pay commissions.

The Service chiefs have been proved right. They are “unwilling to implement” the Sixth CPC report as it is. Recent media reports state that the three Chiefs have apprised Defence Minister AK Antony and want the “anomalies” removed and the status and parity of payscales to be restored.

After sensing the mood, Antony is learnt to have assured the Chiefs that he would take up the matter with the Government. Till then, the three Chiefs have sought that implementation for officer ranks be “held in abeyance.” They have, however, thanked the Government for hiking salaries of Personnel Below Officer Ranks (PBORs) as desired. But, their grievance that the disparity between service officers and their civil service counterparts not only remains, but has increased. Basically they point out:

* Disparity in Pay Bands: The chiefs claim the Committee of Secretaries (CoS) moved the Director rank into Pay Band 4 but retained Lt. Col and its equivalent in other services in Pay Band 3. Earlier, they claim, a Lt Col got the same pay as an IAS Director and Rs 800 more than a non-IAS Director. Now he gets Rs 14000 less than an IAS director and Rs 11000 less than a non-IAS director.

* Disparity in Grade Pay: The CoS agreed to their demand to an increase in grade pay across middle-rank officers but also increased the grade pay of civil servants, thereby retaining disparity, the chiefs say. For example, he Pay Commission recommended Rs 6600 for a civil servant equivalent to a Major who was to get Rs 6100. After review, a Major will now get Rs 6600 but his equivalent in the civil service will get Rs 7600.

* Restricting elite list: The new category of HAG-plus (Higher Administrative Grade) includes all DGs and DGPs but only Army Commanders and their equivalents in other services, the chiefs complain. Their demand: all Lt. Gen officers be included in this category. The Defence Ministry is said to have conveyed that the objections are being looked into and a response will be given soon.

While Antony appears to be sympathetic, the Finance Ministry has strongly denied any “injustice” to the Armed forces in this new pay structure. Its officials are emphatic: “In no way are the defence personnel getting any lesser pay than their civilian counterparts. In fact, they will carry home fatter pay packets than civilian services and paramilitary under the new salary structures of the CPC.”

Quoting the new feature of Military Service Pay (MSP) in the CPC, officials say the Armed forces officers would uniformly get Rs 6,000 more, whereas such a pay was not offered to the civilians and the paramilitary. “Under the 5th CPC there was no compensation provided for the risk factor involved in the defence personnel’s job profile. MSP has taken care of that lacuna in the 6th CPC.”

Also, the MSP would be counted along with the Basic Pay of Armed Forces officers for calculating the Dearness Allowance (DA). “That would provide them with Rs 960 DA and the amount would increase as the DA is hiked,” is another argument. In addition, defence officers posted in Siachen would get an allowance of Rs 14,000 and an High Altitude Allowance of Rs 8,000, which adds up to a total of Rs 22,000. Earlier, the personnel were getting only Rs 7,000 as Siachen Allowance and Rs 4,000 as High Altitude Allowance, adding up to Rs 11,000.

Citing an example of the entry-level defence officers in the rank of Lieutenants and equivalent in Navy and Air Force, the officials explain that under the 5th CPC under the pay scale of Rs 8,250-10,500, they received a salary totalling Rs 15,252 as on December 31, 2005 . “On January 1, 2006 , from when the 6th CPC would be effective, a Lieutenant under the Pay Band-3 will receive an additional Grade Pay of Rs 5,400 and MSP of Rs 6,000, making his or her total emoluments Rs 27,000. As on September 1, 2008 , when the 6th CPC was implemented, a Lieutenant would get total emoluments of Rs 28, 947,” the officials add. As against this, their civilian counterparts in the pay scale of Rs 8,000-13,500 under 5th CPC had received a pay of Rs 14,880.

Another argument put forth is: A Lt Colonel under the 5th CPC received a Gross Pay of Rs 28,086. But under the 6th CPC, he would receive a Grade Pay of Rs 7,600 and MSP of Rs 6,000 under Pay Band-3. His pay as on January 1, 2006 , would be Rs 41,690. From September 1, 2008 , when 6th CPC was implemented, Lt Colonel’s emoluments stood at Rs 45,000.

With the Finance Ministry virtually rejecting their demands, the Armed Forces’ chiefs rightly have asked that the issues raised by them should be addressed by the country’s political leadership and not Anomalies Committee. “The CPC created disparities are not just pay anomalies, but core issues. Hence, these cannot be left to the Anomalies Committee. But the Cabinet must consider them and issue a corrigendum to the CPC notification,” Navy chief Admiral Sureesh Mehta, in his capacity as the Chairman of the Chiefs of Staff Committee, insists.

Clearly, the issues such as “extant parities of pay” to Lieutenant Colonels and equivalent officers vis-à-vis their civilian and paramilitary counterparts, is not just related to the CPC, but could seriously jeopardise “operational” and “functional” harmony of the defence forces, whenever and wherever they worked alongside the civilian and paramilitary forces officers. .

Let us face the facts that the disparity “badly demoralise” the officers of the Armed Forces and if these persist, it could lead to “despondency” among the defence cadre. Admiral Mehta has even met Prime Minister Manmohan Singh to press for the removal of anomalies, explaining that it has serious implications of the command and control element during Unified Command Operations if not addressed. Singh is learnt to have promised that he will personally look into the issues raised.

Let us hope that the Cabinet Committee on Security removes these disparities so that the soldiers do not get demoralised and save the nation from a serious catastrophe. A demoralised force cannot save the sovereignty, security and integrity of the country.

Author : Col (Dr) PK Vasudeva (Retd) -INFA

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Six Pay Commission | States want Centre to bear 50 pc burden of pay revision

Filed under: india,Pay Commission — tarunreflex @ 10:22 am
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The VAT panel wants the Union Government to bear at least half of the financial burden that the states will have to bear following the implementation of the Sixth Pay Commission recommendations.
“At least 50 per cent of the additional financial burden of the states as a result of the Centre’s decision on the Sixth Central Pay Commission should be shared by the Central Government,” Chairman of Empowered Committee of State Finance Ministers on VAT Asim Dasgupta told reporters here today.
The pay panel’s recommendation on pay revision of the Central Government employees is to be implemented from the current month itself. Many states like Uttar Pradesh, Haryana, Chhattisgarh and Tamil Nadu have also decided to go for pay revision of their employees.
However, in case of special category and north-eastern states, the VAT panel asked the Centre to bear the entire additional burden of the pay revision.
Dasgupta said another option was that financial burden was fully accommodated by the Thirteenth Finance Commission, while assessing expenditure needs of the states. He stressed the Commission should work on modalities, which would provide a more justified relief to the states.
Referring to the royalty on coal and other minerals, the VAT panel asked the Thirteenth Pay Commission to revise it frequently and wanted that the states were not denied their legitimate share on royalties on oil and power.

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Satyam to downsize its workforce by a whopping 4,500 employees.

After delayed appraisals and cut in payouts, India’s fourth largest IT service provider, Satyam Computer is reported to downsize its workforce by a whopping 4,500 employees. This translates to a little less than 9 per cent of the 51,000 employees that the company employs.

Company sources reveal that 1,500 employees have been put under the performance improvement plan (PIP), euphemism for employees put on watch list and asked to shape up or ship out. Apart from this, 3,000 others have not been given any increment in the last appraisal cycle, thereby indicating that their services are dispensable.

Last Friday, company’s chief Ramalinga Raju had sent out an email to all employees warning them, especially the ones on the bench, to not bunk office and be in their best dress code, failing which they may face strict disciplinary action.

The company is reported to have handed pink slips to about 400 engineers and associates in Hyderabad, Pune and Visakhapatnam centers. The company management reportedly asked some of the employees to move out of its rolls to a contractual agreement or leave.

Like its peers, Satyam too claims that the layoffs are a part of its appraisal system. Global head, human resources, SV Krishnan says, “Our experience has shown that around half of them exit the system either voluntarily or involuntarily. We have concluded our appraisal process some weeks back, and we believe we are witnessing similar trends like those in the past.”

There were also reports that the company has deferred the joining date of 7500 graduates it had recruited from various college campuses this year. However, the company said that it has no intension of withdrawing these offers. Interestingly, the company has recently announced plans to hire 15000 this year.

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Tata Consultancy Services is gearing up to another round of layoffs.

According to a recent report Asia’s largest software exporter, Tata Consultancy Services is gearing up to another round of layoffs. The company also plans to discourage employees from staying on bench for more than two months on any of its centres.

Incidentally, the company had also fired close to 500 employees, citing poor performance after its annual appraisal. It was also among the very first companies to announce a cut in the employee variable pay across the board.

The company which sees some project delays this quarter, but no cancellations, terms this as an employee utilisation exercise. The process will involve counselling employees and training them. Employees would be asked to undertake projects on which they have never worked on and will have to update their skills.

Recently, TCS also retrenched 15 employees from its Australian subsidiary. Interestingly, last month too, the company had shown door to some 25 employees from its Kolkata and Bangalore centers for fudging CVs.

By June-end, the total employee strength TCS stood at 116,300, across 64 countries. The company hired 8,982 employees in the first quarter.

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Wipro lays off 1,000 employees, and another 2,000 put on scanner

The bad news has come from India’s third largest IT outsourcer, Wipro Technologies too. The company has already laid off 1,000 employees, and another 2,000 employees have been put on scanner.

The company is reviewing the performance of 60,000 global IT services employees from the senior leadership team down to the person with one-year experience.

Terming it as a regular exercise, company’s corporate vice-president (human resources) Pratik Kumar said, “As the appraisal cycle gets over, a multi-layer review happens. Following that, people who have fallen in the lower quadrants of performance are put on watch. Some are asked to pull up and others are asked to move on.”

He added that, “We took a closer look at our hiring and realised that we did not need to hire more, since there were people on the bench.” Many employees are being given counselling to improve their performance, others may be asked to leave.

At the end of the quarter ended June 2008, Wipro’s IT services employee base had fallen to 61,345 from 62,070 employees at the end of the previous quarter.

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Patni cuts off workforce by 3%

In July, Mumbai-based Patni Computer Systems too gave pink slips to 400 employees on grounds of non-performance.

Terming it as a routine exercise and not a slowdown setback, country’s sixth-largest exporter said that it is an effort to weed out non-performers.

Rajesh Padmanabhan, vice-president and head, global HR, Patni, said, “This is an absolutely regular appraisal that is important for any performance-driven organisation. It is something standard we do every year. Employees who have got 0-1 rating on a scale of 5 typically form the basis for the first-level shortlist. These are performance-based resignations; we’ve not issued any termination letters.”

However, industry sources reveal that the laid off employees included several project managers as well. Incidentally, while in case of TCS, the retrenched number was about 0.5 per cent of the workforce, for Patni, it made for closer to 3 per cent of the 14,800-strong workforce.

Narendra K Patni, Chairman and CEO, Patni Computer Systems said, “The overall market environment remains challenging with prevailing global uncertainties. We are cautious in our short-term outlook but remain positive on long-term prospects and are continuing our investments in identified areas.”

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HP India to cut 1,000 jobs?

Hewlett-Packard’s decision to eliminate nearly 25,000 of its 320,000 jobs worldwide is expected to have a significant impact on its Indian operations too.

Analysts in India believe that in the short term, the company could see off some 1,000 people, and that in a three year period this could go up to 6,000 of its nearly 60,000 people in the country.

The computer and printer maker’s job cuts come as part of its plan to integrate Electronic Data Systems (EDS), the computer services giant that HP acquired for $13.9 billion in August as part of an effort to match IBM in the services space.

Following the acquisition, a workforce reduction was seen as inevitable, but the figure HP has announced is way beyond anybody’s expectations.

Kapil Dev Singh, managing director of research firm IDC India, said HP’s announcement mostly stems from the global economic scenario. “It’s an instant fall out of what’s happening on Wall Street. The IT accounts of banking and financial institutions (BFSI) have been shrinking. So hiring for this space has been put on a slow burner by global companies,” he said.

Mohan Lal Menon, managing director of strategy advisory firm Sentient, said a lot of overlapping was expected with the integration of HP and EDS Mphasis (in India, EDS had previously acquired Mphasis).

Most of it would have been in the areas of HR, administration, sales and marketing. But the trigger for HP is definitely the precarious conditions in the BFSI space across the US, Europe and Asia. HP seems to be ahead of the curve, towards planning for the economic downturn,” he said.

Till the time of going to print, HP had not responded to questions sent by TOI on the impact HP’s workforce reduction move would have on India.

However, a senior official at Mphasis said no immediate impact was expected on Mphasis. “We have been hiring junior to top talent. We have been expanding our footprint across the country. So its business as usual,” he said.

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