Are the majority of the people overpaid?

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Are the majority of people overpaid?

I would like to answer the above question from an Indians’ perspective.

India has some forty lakhs of central government employees and then more than 20 lakhs Railway employees.Apart from that there are state government employees in more than thirty states and as many as nine union territories. There are employees in public sector undertakings of the central government and the state governments. There are Nationalised bank employees and the schedule bank employees. Apart from that there are Public Sector Insurance Companies like LIC, National, United India, New India Assurance, Oriental etc and of late, a scores of private multinational insurance companies.

Apart from that there are large private sector organizations like TATA, Birla, Reliance, Godrej, L&T and Wipro etc which have employed considerable number of employees in their companies and their subsidiaries.

Apart from these there are thousands public limited and private limited companies employing thousands of people. Now there are hundreds of multinational companies employing thousands of Indians.

Barring the above said organizations there are thousands of proprietory organizations, employing plenty of employees.

Now we have to analyze about the pay structure prevailing in the various sectors whether they are overpaid or not.

The pay and allowances of the central government employees are regularized through a pay commission appointed by the Central Government once in five years and the pay commission’s recommendations, subject to modifications is implemented by the Government of India. The State governments though appoint separate pay commissions for their employees they mostly follow the central pay commission’s recommendations for their employees. However, some North Indian states like Bihar implement a lower scale than that of central government employees and this disparity has been confirmed by the Supreme Court of India, on the ground, each state government is justified to implement its own pay scales to its employees depending upon the financial conditions of the state.

A few months ago, the 6 th central pay commission was submitted to the Central Government in which the top level officers belonging to Group A and class I, have been recommended a maximum scale of Rs 90,000/- per month (equivalent to $ 2143) and the lowest scale recommended to a class IV employee at the entry level is Rs 6,660/- per month (approximately $ 160) and the gap between the top cadre and the lowest cadre is in the ratio of 1: 15 and the gap is widening as time goes on in each pay commission. Railways and the defense personnel are also covered by the central pay commission.

Even though, the central government is expected to revise the salary of its employees once in five years through its pay commission, in practice it takes nearly ten years to submit each pay commission’s recommendations. Until then dearness allowance or dearness pay and interim relief etc are given to its employees.

The bank employees and public sector employees are somewhat better in getting a better package, since they are governed by BPE (Bureau of Public Enterprises) and their pay scales are revised periodically once in three years.

The multinational companies, especially the IT companies are paying good salaries to its employees, but they employ Indians only to avoid paying higher salaries to their own country men.

The private and public sector companies are paying only moderate salaries to their employees.

The proprietory concerns are paying only meager salaries to their employees according to their whims and fancies.

There is always a gulf between the pay structure of the government employees and the public sector employees. Similarly there is  disparity between the pay scales of public limited companies and the private limited companies. Not to speak of the plight of the employees who serve the proprietory concerns.

The central government employees have been agitating, demanding higher pay scales ever since the sixth pay commission submitted its report.

Bonus is being given to the government employees only as a deferred wage accepting in principle that there is disparity of pay scales between various employees of the government sector and they are underpaid.

Whether it be government sector or public sector or proprietory concerns only the top level employees serving in a managerial capacity are well paid, given the pay structure and economic conditions prevailing in India and most of the employees serving in the subordinate category are actually paid only meager amount as salaries.

Undoubtedly, the central and state government employees form the major chunk of the employees in India and their pay scales are inadequately woeful.

Therefore, as far as India is concerned, the majority of the employees are only underpaid and not overpaid.


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