Economy

Steel PSU employees seek full benefits as per third pay revision

Our Bureau New Delhi | Updated on December 10, 2019 Published on December 10, 2019

Oppose ‘Affordability’ clause in 2017 guidelines issued by Department of Public Enterprises

Employees of public sector undertakings in the steel sector have written to the centre seeking full benefits to be accrued as per recommendations of the third Pay Revision Committee (PRC). The employees have been denied wage hikes citing provisions issued by the Department of Public Enterprises (DPE) during August 2017.

According to ‘Affordability’ clause under the DPE guidelines, the additional financial impact of the wage hike in the year of implementing should not be more than 20 per cent of the average Profit Before Tax (PBT) of the last three financial years preceding the year of implementation.

The proposed wage hike covers board level executives, below board level executives and Non-unionised supervisors.

“We strongly feel that PBT of three years cannot be a true indicator of a company’s performance,” a letter from the Steel Executives Federation of India (SEFI) said. The SEFI represents around 25,000 officers working in Steel sector PSUs such as Steel Authority of India (SAIL), Rashtriya Ispat Nigam (RINL) and MECON.

The guidelines

The DPE guidelines also note that no fitment or any other benefit of pay revision will be implemented in the Central Public Sector Enterprises (CPSEs) where the additional financial impact of the revised pay package is more than 40 per cent of the average PBT of last three financial years.

“There has been some setback in financial year 2015-2016 which has adversely affected the prospect of pay revision for executives of SAIL…it will be a travesty of justice if the executives of SAIL and other steel sector PSUs are denied the full benefits of third pay revision solely on the basis of performance of one year (2015-2016) while ignoring the overall performance of the preceding years,” the letter said.

According to officials in the know, the average PBT of the last three financial years (preceding the implementation of the third pay revision) wereFY 2014-2015, 2015-2016 and 2016-2017, was negative in case of SAIL. Accordingly, salary revision in case of Executives of SAIL could not be implemented.

These provisions have irked employees who said that wage revisions come at a gap of 10 years so it is unfair to assess the eligibility while considering the performance of just three years. The employees also say that the losses incurred by SAIL are purely attributable to external factors such as adverse global market scenario, bad commodity cycle in metal sector – particularly in steel, among others.

Published on December 10, 2019
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