An average 12 per cent increment in wages for employees of New India Assurance, National Insurance, Oriental Insurance and United India Insurance — the four public-sector general insurance companies — has been approved by the Ministry of Finance. This wage revision will come into effect starting August 2017. The employees of these companies will also receive arrears for five years.
As per the gazette notification dated 14 October 2022, the scheme is called ‘the General Insurance (Rationalisation of Pay Scales and other Conditions of Service of Officers) Amendment Scheme, 2022’.
On an average, the incremental liability for each company will be about Rs 250 crore, say media reports.
However, the next wage revision, which is due from August 2022, will be in the form of a variable pay, basis employee performance as well as the performance of the company. This performance-linked variable pay has not gone down well with the employees.
The new performance-based revision will be applicable to all senior officials, as well as development, supervisory, clerical and subordinate staff. Notifications have been issued to all to this effect.
The reason for this move may be because New India Assurance posted a net profit of about Rs 164 crore for FY 2021-22, while United India Insurance posted a net loss of Rs 984.68 crore. National Insurance also posted a loss of Rs 1,674.74 crore, while Oriental Insurance incurred a loss of about Rs 1,525.44 crore during FY 2020-21.
