Dear Seniors,
In a case we are proposing to transfer an employee from a unit to another unit, which is in commissioning stage and yet to be started. In his present unit he is getting CTC which is including some kind of Bonus based on company performance, which costs around Rs. 2500/pm.
In this case of Transefer, whether we can reduce the same amount by his CTC, as there is no any production started at the new unit? If we propose to reduce the same amount (Rs. 2500/-PM), whether he can claim this bonus amount or demand the same in other mode.
Is there any legal default in decrease of his present earning? If yes please give the reference of any section / rule etc.
Based on the same decision, we may have the clear idea for the amicable solution to such transfer issue in future.
Hoping for urgent reply from all seniors, please,
Regards,
Atul
From India, Sholapur
24In a case we are proposing to transfer an employee from a unit to another unit, which is in commissioning stage and yet to be started. In his present unit he is getting CTC which is including some kind of Bonus based on company performance, which costs around Rs. 2500/pm.
In this case of Transefer, whether we can reduce the same amount by his CTC, as there is no any production started at the new unit? If we propose to reduce the same amount (Rs. 2500/-PM), whether he can claim this bonus amount or demand the same in other mode.
Is there any legal default in decrease of his present earning? If yes please give the reference of any section / rule etc.
Based on the same decision, we may have the clear idea for the amicable solution to such transfer issue in future.
Hoping for urgent reply from all seniors, please,
Regards,
Atul
From India, Sholapur
Atul, The word Bonus may create a trouble for you, since the bonus can not be retained/forfeited. Therefore you may explore the opportunity to reduce the wages in other components.
From India, Jaipur
From India, Jaipur
Dear Atul
There are three kinds of transfer:
1. Transfer to a bigger scope job which results in a promotion - salary needs to be upgraded to correspond to enlargement.
2. Transfer to a smaller scope job which is deemed as a demotion - salary will be reduced accordingly BUT such terms and conditions need to be clearly communicated to the employee at least 3 months before this transfer. If he accepts this new terms and conditions, a new employment letter of offer needs to be issued to him for his endorsement with copies filed in his personnel file. In this situation, you must also planned for the situation where the jobholder refuses to accept the lower package. What's next? Termination?
3. Lateral transfer - transfer from different functions/units but still performing same grade job. In this situation, your organization must have some forms of grade structure or hirearchy structure in place to be effective.
From the above, how best to describe the said transfer in your organization and what are the objectives?
I have however these questions for you to ponder:
1. Was this transfer initiated by company or the individual?
2. If the transfer is initiated by company and performance of individual is not questionnable, why deduct Rs 2500/-pm to pensalize the individual?
3. There may be "no production" yet but a lot of works need to be done when you are "pioneer" in a new unit. Does this not create an "off-set" effect at the most?
Put yourself in his shoe, you should be able to derive some objective and balanced policy & procedure from there.
Regards
Autumn Jane
From Singapore, Singapore
There are three kinds of transfer:
1. Transfer to a bigger scope job which results in a promotion - salary needs to be upgraded to correspond to enlargement.
2. Transfer to a smaller scope job which is deemed as a demotion - salary will be reduced accordingly BUT such terms and conditions need to be clearly communicated to the employee at least 3 months before this transfer. If he accepts this new terms and conditions, a new employment letter of offer needs to be issued to him for his endorsement with copies filed in his personnel file. In this situation, you must also planned for the situation where the jobholder refuses to accept the lower package. What's next? Termination?
3. Lateral transfer - transfer from different functions/units but still performing same grade job. In this situation, your organization must have some forms of grade structure or hirearchy structure in place to be effective.
From the above, how best to describe the said transfer in your organization and what are the objectives?
I have however these questions for you to ponder:
1. Was this transfer initiated by company or the individual?
2. If the transfer is initiated by company and performance of individual is not questionnable, why deduct Rs 2500/-pm to pensalize the individual?
3. There may be "no production" yet but a lot of works need to be done when you are "pioneer" in a new unit. Does this not create an "off-set" effect at the most?
Put yourself in his shoe, you should be able to derive some objective and balanced policy & procedure from there.
Regards
Autumn Jane
From Singapore, Singapore
Hi there!
Thanks a lot for your prompt response.
Actually the last sentenance you have made is really worth and personally myself fully agree with this.
The case is as follows,
1. We are in stage of expansion. Accordingly we have been allotted a land and construction of factory is going on. It will take another two-three months to complete the machine errections / installations etc. Probably Production will be started soon after m/c work completed.
2. The employee, who is proposed to transfer to the new location is looking after accounts activites right now. His CTC includes the amount (declared as 'Company Performance Bonus') appr Rs. 2500/-pm.
3. Now management wants him to transfer and raising the point that due to non produciton for next three months, we are not bound to pay the Comapny Performance Bonus to him in his transfer case, though he is being tansferred in same cadre, grade, designation or profile as per his existing.
4. Though, It may be a question to decrease his earning, as this amount is purely based on the performance of the comapny, he may not have the right to demand it.
5. Further, whether he will be ready or not ready for his transfer, he or any other should be treated in the same way.
Hence, I need a strong point comes under legal provisions, which may include such case. So that with this legal conclusions, I can again put up this matter strongly.
Of course, no any human being will ready to curtail his present remuneration, what so ever reason may be and I feel that he should not be transferred like a punishment.
Please revert with your remakrs / suggestions
With regards,
Atul
From India, Sholapur
Thanks a lot for your prompt response.
Actually the last sentenance you have made is really worth and personally myself fully agree with this.
The case is as follows,
1. We are in stage of expansion. Accordingly we have been allotted a land and construction of factory is going on. It will take another two-three months to complete the machine errections / installations etc. Probably Production will be started soon after m/c work completed.
2. The employee, who is proposed to transfer to the new location is looking after accounts activites right now. His CTC includes the amount (declared as 'Company Performance Bonus') appr Rs. 2500/-pm.
3. Now management wants him to transfer and raising the point that due to non produciton for next three months, we are not bound to pay the Comapny Performance Bonus to him in his transfer case, though he is being tansferred in same cadre, grade, designation or profile as per his existing.
4. Though, It may be a question to decrease his earning, as this amount is purely based on the performance of the comapny, he may not have the right to demand it.
5. Further, whether he will be ready or not ready for his transfer, he or any other should be treated in the same way.
Hence, I need a strong point comes under legal provisions, which may include such case. So that with this legal conclusions, I can again put up this matter strongly.
Of course, no any human being will ready to curtail his present remuneration, what so ever reason may be and I feel that he should not be transferred like a punishment.
Please revert with your remakrs / suggestions
With regards,
Atul
From India, Sholapur
Dear Atul
I am not familar with the legal aspect and employment act for India, so I will leave it to other seniors to advice you accordingly. But from HR prospective, these are additional information that may be useful for you.
1. As long as it is not Guaranteed / Fixed / Contractual bonus, it can be reduced and/or taken away.
2. If it is clearly stated and communicated that it is Company Performance Bonus, then the quantumn can be reduced and/or taken away after proper administration of the performance management system. I do however have an additional question to ask - did the jobholder stop work or is he still performing his job in the current location while the construction is continuing for the next 3 months? If he is still performing his job, why cut his pay?
3. Administratively the situation is much easier because it is a transfer within the same cadre, grade, designation and profile. While he will be able to transit into his job (technical aspect) quite easily, there's another aspect that's usually overlooked and that's emotional / mental hardship that is to be transferred away from a familar place, away from usual click, longer traveling distance to work, etc. This hardship coupled with a reduction in CTC is really a double whamy for him.
4. Lastly, you have mentioned that the company is undergoing expansion. An expansion would translate into increased in activities and in volumes which needs the committement of all employees. Shouldn't the company be looking at compensating the staff more because workload has increased instead of cutting it? Or should the company temporarily cut CTC but reinstate to the equitable level when the time is right?
Regards
Autumn Jane
From Singapore, Singapore
I am not familar with the legal aspect and employment act for India, so I will leave it to other seniors to advice you accordingly. But from HR prospective, these are additional information that may be useful for you.
1. As long as it is not Guaranteed / Fixed / Contractual bonus, it can be reduced and/or taken away.
2. If it is clearly stated and communicated that it is Company Performance Bonus, then the quantumn can be reduced and/or taken away after proper administration of the performance management system. I do however have an additional question to ask - did the jobholder stop work or is he still performing his job in the current location while the construction is continuing for the next 3 months? If he is still performing his job, why cut his pay?
3. Administratively the situation is much easier because it is a transfer within the same cadre, grade, designation and profile. While he will be able to transit into his job (technical aspect) quite easily, there's another aspect that's usually overlooked and that's emotional / mental hardship that is to be transferred away from a familar place, away from usual click, longer traveling distance to work, etc. This hardship coupled with a reduction in CTC is really a double whamy for him.
4. Lastly, you have mentioned that the company is undergoing expansion. An expansion would translate into increased in activities and in volumes which needs the committement of all employees. Shouldn't the company be looking at compensating the staff more because workload has increased instead of cutting it? Or should the company temporarily cut CTC but reinstate to the equitable level when the time is right?
Regards
Autumn Jane
From Singapore, Singapore
Thanks again Autumn Jane,
Whatever you have explained is absolutely correct.
Your first statement is also correct. It is not guaranteed / fixed so it could be revoked and communication could be done in this regard to concerned.
But on a humanatarian ground, we need to look his emotions also. Because of only transfer of his services, he is loosing such amount, which may affect his performance, mental & job satisfaction and ultimately his peace of mind.
So, I am trying to compensate this amount in a other way and proposal of this change is now presenting to top management. As well as I am trying to find out legal aspects also, so that the case would become a mandatory.
I hope I could do the best and I wish the management would also grant it.
Anyway, I am thankful to you for your support and such valuable information to me. May I know, from where you are? and what is you profession? Just for my information only.
It's great to being with you,
Thank you....
Atul
From India, Sholapur
Whatever you have explained is absolutely correct.
Your first statement is also correct. It is not guaranteed / fixed so it could be revoked and communication could be done in this regard to concerned.
But on a humanatarian ground, we need to look his emotions also. Because of only transfer of his services, he is loosing such amount, which may affect his performance, mental & job satisfaction and ultimately his peace of mind.
So, I am trying to compensate this amount in a other way and proposal of this change is now presenting to top management. As well as I am trying to find out legal aspects also, so that the case would become a mandatory.
I hope I could do the best and I wish the management would also grant it.
Anyway, I am thankful to you for your support and such valuable information to me. May I know, from where you are? and what is you profession? Just for my information only.
It's great to being with you,
Thank you....
Atul
From India, Sholapur
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