HR heads react on government’s decision to scrap overtime allowance for govt. employees

The Government is emphasising on increasing efficiency and productivity through automation. 

There’s less to cheer for government employees as the Centre has decided to end the overtime allowance (OTA) given to its employees, except operational staff, according to an order issued by the Personnel Ministry. The decision came from a recommendation of the Seventh Central Pay Commission in this regard. That is not all; now the grant of overtime allowance will be linked to the biometric attendance.

It has clearly spelled out the provisions of OTA and stated that it will only be granted when senior officers direct the concerned employee(s) in writing to stay back in office to attend to work of urgent nature.

The Government has also decided not to revise the rate of OTA for the operational staff, who will continue to get the amount as per its order issued in 1991.

With the Government emphasising on increasing efficiency and productivity by increasing automation, most feel that the move is in the right direction. “The existing government offices are encouraging a substantial amount of digitisation of processes, and manpower can now deliver services within the stipulated time. However, employees in the manufacturing sector will not fall under this new rule and miss out on the allowance as statutes, such as the Factories Act and others apply,” said Lalit Kar, vice-president & head, human resources at Mumbai International Airport.

“The overtime allowance is mostly applicable to blue-collar jobs and not managerial-level or white-collar jobs. Employees who are output driven can achieve results within the stipulated work hours or even less. Hence, it doesn’t make sense for staff members,” said Amitabh Sagar, CHRO, Poly Medicure.

Employees on the floor or plants hardly have opportunities to grow in their role, unlike staff members.

Corporates in India don’t have the concept of overtime pay for employees. Most HR leaders feel it makes sense for government employees because their increments are fixed yearly, while corporates offer facilities to work from home, flexible work hours, telecommunicating, besides suitable reward strategies, on a regular basis.

In fact, leaders believe that it is not right to inculcate the habit of overtime at a lower level because ultimately the person grows in the organisation with the right compensation and designation.

Some companies also offer compensatory leaves to employees for overtime. “In sales organisations, managers mostly stretch their work hours to meet targets, in which case, they are incentivised. But companies cannot pay extra for odd hours spent on activities which might not yield any business, as it will be a loss to the company. Those who are employed in operational activities, such as manufacturing or services—where employees are working for stipulated hours and to ensure the targeted number of transactions—need to be compensated,” said Sharad Sharma, SVP & head-HR, DHFL Pramerica Life Insurance.