India

7th Pay commission recommends abolition of overtime

5 May 2016 | By Achin Garg
Overtime: To pay or not to pay?

The Seventh Pay Commission has recommended the abolition of overtime allowances given to central government employees.

However, for industrial staff and operational employees such as those in railways and defence ministries, where overtime is mandated by law, the panel has recommended increasing it by 50%.

A committee of secretaries headed by Cabinet Secretary, P. K. Sinha, is reviewing the commission's recommendations.

In context: Overtime: To pay or not to pay?

Financial burden of 7th pay panel

According to the government's estimates, the implementation of the new pay scales as recommended by the Seventh Pay Panel will cost an additional Rs.1,02,000 crores or 0.7% of the GDP.

About What is the seventh pay commission?

Pay Commissions are set up by the government intermittently, to revise the salary structure of government employees.

The first pay commission was set up in 1956 and since then, a pay commission had been set up every decade.

The latest, the Seventh Pay Commission, headed by retd. Justice AK Mathur, was set up in Feb'14 and was given 18 months to submit its report.

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Pay commission affects remuneration of 80 lakh people

The revision of salary structure by the Seventh Pay Commission affects the salaries of 50 lakh central government employees and the remuneration of 30 lakh pensioners.

5 May 20167th Pay commission recommends abolition of overtime

Why Why does overtime need to be scrapped?

The Seventh Pay Commission data shows that the overtime has more than doubled from Rs.797 crores in 2006-07 to Rs.1,629 crores in 2012-13.

According to the Seventh Pay commission, government offices need to improve productivity and efficiency and control government expenditure.

"Government employees, like everyone else, should be paid for results, not to spend time in the office" -Rathin Roy, Seventh Pay Commission member.

Overtime rising faster than pay

In the case of railways, the overtime allowances have increased at a faster pace than even the pay of the employees. While the pay increased by 13.2%, the overtime allowances grew by 17.2%.
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Overtime Railways, defence account for the bulk of overtime

The Seventh Pay Panel has observed that the overtime given to the railway and defence ministries account for 90% of the total overtime paid by the government.

The defence ministry has been able to control the overtime allowances from 8% of pay in 2006-07 to 6.54% in 2012-13.

However, the overtime allowances in railways have increased from 2.09% in 2006-07 to 2.58% in 2012-13.

Review committee's report after elections

The committee of secretaries formed by the government to review the Seventh Pay Commission's recommendations will submit its report after the assembly elections get over in May.