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Finance Ministry has notified wage revisions for officers and employees of four public sector general insurance companies – New India Assurance, United India Insurance, Oriental Insurance and National Insurance. It added that from now, the wage revision will be linked to the performance not just of the company, but also of employees.
“It is 12 per cent wage hike for each company at an average incremental liability of ₹250 crore per company.,” a senior Finance Ministry official told businessline. The new wage structure will be ‘deemed to have come into force on August 1, 2017.’ This means the revised structure will apply to those officers and employees who were in the service of the Corporation or Company as on or after August 1, 2017. Officers and employees will get an arrear for five years.
According to the latest Annual Reports of all four Companies, New India Assurance had 13,929 officers and employees as on March 31, 2022. United India Insurance reported 12,837 people on its roll as on March 31, 2021. For Oriental Insurance, the number was 10,488 as on March 31, 2021, while National Insurance has 9,569 officers/employees on its roll as on March 31, 2022. Only New India Assurance is listed on the stock exchange.
Performance based
The Ministry issued three notifications – one for senior officials, one for development staff and one for supervisory, clerical & subordinate staff. All three notifications have one new provision which says: ”The next revision due from August, 2022 will be in the form of variable pay based on the performance of the company and the employee.” This means the next revision will be performance-based.
One reason for this is the financial position of these four companies The latest annual results of New India Assurances show it ended Fiscal Year 2021-22 with a net profit of ₹164 crore. However, United India Insurance closed with a net loss of ₹984.68 crore in FY 2020-21, National Insurance with a loss of ₹1,674.74 crore in FY 2021-22, and Oriental Insurance with a loss of ₹1,525.44 crore during FY 2020-21.
PSGIC wages
Wages in public sector general insurance companies (PSGIC) are settled periodically on the basis of negotiations between PSGICs and the unions of workmen employees, in terms of the provisions of section 19 of the Industrial Disputes Act, 1947. In the case of non-workmen employees, wage revision is agreed to between PSGICs and associations of such employees after discussions among them.
PSGICs negotiate/discuss with unions/associations through the General Insurers’ (Public Sector) Association of India (GIPSA). Based on such settlement/discussions, the amendments proposed by GIPSA to the schemes made by the Central Government under section 17A for regulating the terms and conditions of PSGIC employees are considered by the Government.
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