Good news: 12% wage hike for employees of PSU general insurers; links next with performance

The Ministry of Finance on Saturday notified an average 12 per cent wage hike for employees of four public sector general insurance companies. The wage hikes would be effective from August 2017. The scheme is called the General Insurance (Rationalisation of Pay Scales and other Conditions of Service of Officers) Amendment Scheme, 2022.

This wage revision is effective from 1 August 2017. Only who have worked in these companies during this time will get arrears for five years. A gazette notification dated 14 October 2022 said the next revision is due from August 2022. It will be in the form of a variable pay based on the performance of the company and the employee, the notification read.

However, the Unions are not happy with the imposition of pay linked to the performance of the company and their performance.

“We are having strong reservations against the way the wage revision has been done after the wait of 64 months. Linking wages with performance seems to be illogical as we employees undertake so many government schemes,” General Insurance Employees’ All India Association (GIEAIA) general secretary Trilok Singh said.

He added that there is no level playing field for public sector insurance companies. He said the employees of state-owned insurance firms make all the government schemes successful and not the private sector. GIEAIA general secretary said the data has suggested that the private sector has been laggard.

He emphasised that unions are not against reforms but it should be done keeping in mind the public sector nature of these companies.

In 2021, the Central government had notified the General Insurance Business (Nationalisation) Amendment Act. This Act will allow the government to cut its stake in state-owned general insurers to below 51 per cent.

As the Central government has announced a 12 per cent hike along with five years of arrears, wage bill for New India Assurance, National Insurance, Oriental Insurance and United India Insurance would increase by around ₹8,000 crore, an official source was quoted as saying by PTI.

Wage revisions for public sector banks and insurance companies are done every five years. The next wage revision for employees of insurance companies are due from August 2022.

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