Sunday, August 15, 2010

Govt.studying Khandelwal Committee report, It will take time to take a view.

The Centre is examining the AK Khandelwal Committee Report, which was submitted to the government recently.
“The Khandelwal Committee Report has been submitted to the government. It is being examined and we are holding consultations. It will take some time to take a view on it,”
Financial Services secretary R Gopalan said.
The committee headed by A K Khandelwal, former Chairman and MD, Bank of Baroda, has recommended that each public sector bank be allowed to settle salaries for its employees in accordance with their specific skill sets and the banks’ overall performance. Other members of the panel are MV Nair, Chairman and MD, Union Bank of India, Deepak B Phatak of IITBombay and T V Rao of IIMAhmedabad.
Currently, PSU banks follow an industry-wide wage settlement brokered by the Indian Banks Association once in five years. Once, the recommendations of the committee are accepted then this old system would be scrapped. All-India Regional Rural Bank Employees Association, the representative body of the bank officers and employees of the country, has opposed the recommendation for scrapping the industry-wise wage settlement system suggested by the Khandelwal Panel.
Among a host of recommendations made for public sector banks, the Khandelwal committee set up for reviewing human resource (HR) issues in banks has suggested that clerks should be redesignated as banking associates, sub-staff as support staff and cleaners and sweepers as housekeeping staff.
The committee has also recommended revised ceiling amounts for staff welfare to 3% of net profits with limits depending on the bank size. 25% of this amount will be allocated towards medical facilities of retired employees and their spouses.
Variable pay has also been recommended to be considered as a major component of wages. Employee stock option plans can be allotted to 15% of top performers in the executive cadre to arrest attrition rates, the committee said.
According to the committee, a HR audit will be made mandatory for banks every 2 years. Entry-level qualification for clerical staff has been raised to graduation and rural service for 3 years will be mandatory for them.
Banks will incentivise mobility of clerical staff to rural areas. If the recommendations are approved by the ministry, banks will have to monitor staff costs and achieve a staff-cost ratio of 50% in next 5 years. The committee also suggested setting up an institute for leadership development in the banking industry.
For effective succession planning, each post should have 3 persons in reserve. A common pool of general managers in the industry has to be created for future executive director (ED) or CMD posts.
In order to give importance to HR and HR related issues in a public sector bank, the committee suggested an additional designation of an ED who will be responsible for human resource development only.
Source : Finance Buzz and BNET


Anonymous said...

The recommendations regarding scrapping of Industry wide settlement may not be accepted for the following reasons
1.Our so called leaders are saving a lot of money for the Govt by entering in to a settlement which is always treated as historic by all so called leaders.
2.The leaders are facilitating cheapest labour in the world as a Bank clerk cost just half of Govt Peon.

In case the settlement is scrapped many retired comrades will loose their job

Runtrailblog said...

An Opportunity is there .The leaders can charge 4% levy on the incentives/perks (on monthly basis)

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