The managements of Steel Authority of India Ltd (SAIL) and Tata Steel have reached an understanding with the trade unions for wage revision of its non-executives.
This is likely to have a major impact on the salary bill for certain categories of employees.
The pay scales were finalised at a tripartite meeting between the ministry of steel and representatives of SAIL and Tata Steel.
Tata Steel, with all its profit centres, has more than 43,000 non-executives and SAIL 1.4 lakh employees.
Sources close to the development said: "In SAIL's new wage structure, the minimum basic wage would be Rs 4,000 against Rs 2,100 earlier for non-executives. The maximum basic wage for non-executive employees would be Rs 11,400 as against Rs 5,028 earlier."
The same scheme, with modifications, would be extended to Tata Steel. Each employee has been assured of a minimum guaranteed benefit of 20 per cent plus three additional increments. A Tata Steel spokesperson said the final impact on the company is yet to be determined.
SAIL signed the memorandum of understanding (MoU) with the trade unions yesterday. However, the formal agreement would be signed after clearance from the ministry of steel.
The wage revision is also likely to evoke better response for SAIL's voluntary retirement scheme, which has been extended till July 31, after only 2,000 employees opted for the scheme, against a target of 7,000.
As per the terms of the MoU, employees would get revised payment with effect from January 1, 2001, and notional fitment with effect from January 1, 1997. The previous wage agreement expired on December 31, 1996.
Sources said, both SAIL and Tata Steel tried to impress upon the National Joint Committee for Steel (NJCS) that wages should be revised on the parameters of technology and global competitiveness.
It may be mentioned that, according to the stipulated norms wages are supposed to be revised every four years irrespective of market conditions.
Sources said this has led to wide disparities in wages of steel companies settled by the NJCS and steel companies not under the NJCS.
SAIL has also revised the salary of its 16,000 executives with effect from January 1, 2001, with fitment notionally from January 1, 1997.
The revision for executives is generally as per the recommendations of the Justice Mohan Committee. However, the Tata Steel spokesperson clarified that the company will not follow suit.
