Satyam to scrap flexi pay, link allowances to revenue

Satyam Computer Services will scrap the variable pay policy and introduce a revenue-linked allowance from next month for a section of associates in a bid to minimise cost.
    
In an e-mail to its employees, CEO of the company A S Murty said, "A revenue-linked allowance is being introduced effective April 1, 2009. This will only apply to associates working in approved 'billable' roles and those who are allocated billable customer projects."
    
Billable projects are the one where the man-hour is billed as per specified milestones.
    
Murty said the variable compensation policy would be withdrawn from April 1 for all associates across Satyam. However, the fixed compensation would continue undisturbed, he added.
    
In the e-mail, Murty said the company is focusing on two critical issues - rebuilding the organisation and optimising costs. "It is very important to balance income and expenses, and we have to pay close attention to this issue," he added.
    
However, for the third quarter ended December 31, 2008 and the fourth quarter ended March 2009 only the minimum guaranteed amount (25 per cent) of the variable pay would be paid to all associates.