Friday, September 25, 2015

7th Pay Commission: Salary rises should be based on performance

7th Pay Commission: Salary rises should be based on performance

New Delhi: The Seventh Pay Commission is likely to recommend to rise the salary of central government employees should be based on performance in the office, rather than just time served.

The central government urged the Seventh Pay Commission to make proposal for enhanced pay and special incentives as performance based annual increments.

Appraisals for government employees were introduced since British period but didn’t affect pay. Eight years ago, the Sixth Pay Commission asked to link the performance of central government employees with their pay.

The Sixth Pay Commission had carried out a study through the Indian Institute of Management, Ahmedabad, on a performance-based incentive system, to ostensibly improve the performance outputs of Central government employees.

The study was aimed at working out a model whereby a base salary is attached to each post based on skills and responsibility and simultaneously, a second component would be payable over and above the salary on the basis of the productivity and performance of employees, either individually or as a group.

The government employees believe pay should reflect the cost of living while private sector workers believe pay should reflect performance.

Accordingly, the Narendra Modi government plans to move towards making increment programmes based on performance rather than on time-served through the Seventh Pay Commission and automatic annual incremental pay progression would be scrapped in central government ministries and departments.

The original idea behind performance incremental pay is that every central government employee takes a while to become fully competent in a role, so government can reward them as they grow in competence and experience.

Despite the government having powers to withhold increments, but nowadays, very few do, so there is a culture of government employees moving up the pay scale irrespective of their performance.

The bottom line is if government doesn’t get rid of automatic incremental progression, the government can’t control pay, and that is what the Modi government has realised.

The central government employees can play a vital role in this way in nation building.

Therefore, the Seventh pay commission may recommend up to 5 percent performance-based increment instead of automatic annual increment for central government employees.



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