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Scrutiny
  
‘Private’ joys in the ‘Public’ eye!
The Sixth Pay Commission was necessary, but insufficient...
25/12/2008

The public sector employees have always been treated as ‘the children of lesser God’, at least when it comes to compensation and salary packages. A 2008 Study by Hewitt Associates revealed that executives at private giants earn 60-100% more than their PSU counterparts! Keeping this in mind, the Sixth Pay Commission at last brought a sign of relief for the employees at government companies. In its latest plan, the government announced a salary hike of 50-300% for all central PSUs employees. That was the good news (sorry, it’s just one), and now comes the bad part. This compensation plan that tries to replicate the package system of private sector has missed out on a very vital parameter. Where on one hand, in the private sector, a major portion of the compensation is performance-based, there is no mention of the same by the centre in its latest plan.

In private companies, the employees are motivated to perform better by a transparent, performance-based promotion system unlike in the PSUs, where experience is given priority over performance. Worse, since PSUs do not have any hire-and-fire policy (thus guaranteeing a literal life-long job-security), it makes the employees totally reluctant to work and perform, as it is extremely rare that they’re fired for ill-performance. The Pay Commission should have worked on compensation models, wherein a significant part of the compensation is linked to performance, which is objective, logical and easily measurable. And they don’t have to go very far, for few PSUs (like the Dept. of Science and Technology) already use the performance-based incentive plan. BPCL has gone one step ahead and is in the process of implementing ‘360-degree’ feedback, that will make the system more transparent. Paying them ‘well’ is right, but so is paying them ‘right’!

By:- Sray Agarwal
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