8/8/2019 Case Study on Management Salary Review Medical Scheme

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Case Study for Personnel Finance

Review of Compensation Plan for Management Staff

M/s Pragmatic Group engaged in manufacture of Matchboxes has their plants inMumbai.Chennai, Kolkatta and Bareilly. Each division is run by General Manager of unit

who is accountable for all activities and reports to Managing Director in Mumbai. Each

Unit has strength around 700 in Mumbai, 500 in Chennai, 800 on Bareilly and 900 inKolkatta. Besides this group has their forestry activity having strength of 250 in

Uttarachal which supplies wood as Raw Materials to Bareilly and Kolkatta. Out of this

the Management staff in total are 350 at various levels. The review of Management stafftakes place always in the month of April and all exercise start from January, of the year.

The Company has appraisal system based on traditional system and their salary structure

is divided in to Basic, HRA, Peronal Allowances, City Allowance, Special Allowance

and other allowances include L.T.A., Medical allowance, Ex-Gratia, Reimbursement ofPetrol Expenses to those Senior Management staff for their car and to Jr.Management

staff for their two wheelers. The company also pays gratuity to its entire management

staff as per the Payment of Gratuity Act. The company further pays superannuation to its

Senior Managerial People across the country.In each division, except forestry division at Uttarachal, Workers and Staff are governed

by the agreement with the Union/s, which are always signed with 3 yrs terms. Recentlyall Units signed the agreement with their unions giving on and average Rs.800/- to each

workmen/staff, which included all cost.

The Management has following levels for Management staff across the country:

G.M.Sr.Mgr.

Mgr.

Asstt. ManagerExecutives

OfficersThe Revision of Management staff is controlled and carried out from Head-HR Mumbai.At Mumbai, Finance, Sales, Legal and Materials Divisions are located and each

department except Sales do not strength exceeding 3-4 in management grade Total

strength in HO is around 20 including MD.The Management staff expects some rise as all unionized staff have got the rise in their

pay package besides they also expects that management should take care of their Medical

expenses on Hospitalization in case of major sickness or accident.

The company has faced threats from small scales industries in South as they cannot

afford to run the unit in view of price level of the products besides Chennai unit has been

facing striking situations most of time in the year in spite of wage rise.

In the light of the above situation, as representative of Management and Head HR how

you will proceed in Revision of Management Salary for current year and next whatthoughts you would share to evolve Medical Schemes applicable to Management staff

across the country and satisfy the managerial employees of the company.

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