Proposals For Wage Revision In Insurance Industry ClearedJune 23, 2000
The Government has today cleared the proposal for the wage revision for all the classes of employees in the Insurance Sector i.e., Life Insurance Corporation of India, General Insurance Corporation of India and the four subsidiaries New India Assurance Co., National Insurance Company, Oriental Insurance Company and United India Insurance Company.
The revision of wages which would be w.e.f. 1st August, 1997 covers all classes of employees i.e., Class I Officers, Class II (Development Officers), Class III employees (Clerical and Supervisory Staff) and Class IV employees (Subordinate staff). These decisions will benefit almost 2 lakhs employees in the insurance sector consisting of 1.25 lakhs employees in LIC and about 85,000 employees in GIC and the four subsidiaries. The additional cost for Life Insurance Corporation of India would be Rs.158.72 crores annually and for GIC and the companies the cost would be about Rs.142 crores per annum.
The wage revision is for a period of five years and takes retrospective effect from 1st August, 1997 and shall remain in force upto 31st July, 2002. The wage revision in respect of basic pay, dearness allowance, house rent allowance, city compensatory allowance and all other allowances will be given retrospective effect from 1.8.1997. Arrears would be paid to the employees in the insurance industry from the effective date of 1.8.1997. In the last wage revision, while the new pay scales were given effect from 1.8.1992, some of the allowances were allowed only from subsequent dates. But in this wage revision the pay scales and all allowances is being given with retrospective effect from 1.8.1997.
In the past, the wage revision in the insurance industry was revised more or less on similar basis as that of wage revision in the banking industry. But in this wage revision, the linkage with banking industry has been done away with. The wage revision has two parts namely 12% across the board wage increase in the wage bill as on 1st August 1997 and introduction of concept of Productivity Linked Lumpsum Incentive (PLLI) for the first time.
The 12% across the board increase in the wages covers all benefits including additional allowances. Some of the long pending demands of the Employees' Union have been included in the revised wage package. The basic pay scales have been linked to All India Average Consumer Price Index No.1740(CPI 1960-100) and new range of pay scales has been drawn up. The range of basic pay of various classes of employees in the revised scales will be from Rs.7535 to Rs.23,600/- for Class-I officers, from Rs.4950 to Rs.12,300 for Class-II officers in LIC and from Rs.3580 to Rs.12,910 for Class-II officers in GIC, from Rs.3165 to Rs.11,915 for Class-III employees and from Rs.2660 to Rs.6090 for Class-IV employees.