KRISHNAT PATIL
Dear Friends, What steps should be taken before going for Wage settlement. What type of data should be prepared. Krishnat
From India, Pune
SUDIPTA CHAUDHURI
28

Dear Krishna, U can call me at 09830154057 i can tell u the steps or give ur mail id. Sudipta
From India, Calcutta
kannanmv
257

Dear Krishnat Patil,

You need to conduct a wage survey in the neighbouring industries which are of the similar size, turnover and preferably in the same nature of business.

Wage survey generally consists of Wages earned, Monetary value of benefits such as canteen, transport, uniforms, welfare, employee loans, LTA, Medical reimbursement, Mediclaim, Allowances for night shift, lunch reimbursements, gifts on festival days. Also consider the different types of leave extended. The experience profile and qualification of the employees in other companies also need to be considered as wages are also linked to the years of service. The duration of the long term settlements should also be taken into account.

Once this is done consolidate the monetary value and make a comparison with the wages being currently being paid by you.

If your company pays a variable DA then you need to find out the rise in the index points during the duration of the past settlement period. (If the wage settlement is for say 3 years then you need to find out the points 3 years before and find out the actual rise).

You also need to have an idea of the Minimum wages if you are paying around the wages. However if your wage structure is well above this mark then you need not worry.

Based on the above data you need to recommend to the Management the probable increase that can be given to employees. Please remember that all these data and recommendation should be kept confidential and should not leak out.

You also need to find out the actual expectation of the employees who are likely to be covered by the settlement through colleagues working in the shopfloor who in your opinion are likely to give the right number.

If the union has given you a charter of demands then you also need to work out the monetary implication of the same just to have an idea.

From then on the negotiation starts. Of course negotiatiation strategies varies from organisation to organisation depending on the mindset of the union.

But it is advisable to have the final number from the union side as it will be better to make them commit. They will feel that they have a moral victory if the number is committed by them and will publicise that the Management has given the number they wanted (But you need to lead them to the number what you have in mind). In other words say if you intend to give them Rs.3000/- just stop at Rs.2800/- and permit them to commit Rs.3000/- which is the amount you also intended to give.

Once the number is frozen then you can arrive at a bipartitie settlement (Union and Management) followed by a tripartite settlement (Union, Management and Department of Labour). Tripartite settlements have legal validity.

Regards

M.V.KANNAN

From India, Madras
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