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Our Bureau

New Delhi , Sept 6

THE long wait by the nearly 1,15,000 strong workforce of the Life Insurance Corporation for a higher pay packet is over with the Government notifying a fresh 5-year wage agreement providing an across-the-board 13.3 per cent hike.

The Insurance Division of the Ministry of Finance late on Monday issued a notification providing official sanctity to the wage agreement between the LIC management and unions and officers associations.

The new wage agreement would have retrospective effect from August 1, 2002. The negotiations for the wage revision had started on September 9, 2003, with the unions at one point demanding an increase of 30-40 per cent and gradually toning their demands to more reasonable levels.

According to sources, the additional annual wage burden of the corporation on account of the 13.3 per cent hike would be around Rs 293 crore.

LIC's annual pre-revised wage bill at the end of the previous five-year agreement ended July 31, 2002, was around Rs 2,195 crore.

The Finance Ministry has also agreed to the payment of a one-time lump-sum incentive for fiscal 2003-04 and 2004-05. The incentive, being paid in lieu of performance-linked lump sum incentive (PLLI), has been fixed at 1 per cent of the pre-revised wage bill as on July 31, 2002.

Sources said that the ad-hoc incentive is being paid since there was no PLLI in force during the two years.

Currently, LIC is working out a comprehensive incentive plan for its staff which would be based on the growth achieved by the corporation on certain parameters such as increase in new policies, growth in first year premium and growth in total premium income.

As on date, LIC has a staff of 1,14,550. Out of this, the total Class-I employees are 19,149, Class-II 19,233, Class-III 71,322 and Class-IV 4,846.

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