EMPLOYEE RETENTION

EMPLOYEE RETENTION

To design an effective retention plan, you need to first identify the reasons impacting retention in your organization. The most common reasons for attrition in organizations are: Compensation - Lack of external & internal equityBad bossesLack of growth opportunityLack of recognitionPoor fitmentLack of work-life balance These are reasons which can be addressed by the organization in the near team. Other reasons for attrition which may not be within the organization´s immediate control are overseas opportunity, location constraints, brand value of the organization, etc. Having identified the main reasons why your employees are leaving the organization, you now have a better perspective of what your retention plan should address. Let´s take compensation. Your organization´s compensation structure should not be too far divorced from the competitive labour market reference point. Appropriate source for competitive market rates are compensation survey reports. There are consultants who provide such reports. You could also commission a targeted survey. Another source is Jobsites. Many organizations while posting their jobs also communicate the salary details. Exit interviews are also a suitable source. Your job gets more difficult, if your organization´s compensation budget does not support external equity. In such a case, you may have to ensure that at least your key employees are adequately compensated. Besides external equity, lack of internal equity also causes immense dissatisfaction. For similar role, experience, and effort, employees expect certain parity. Identifying similar role and experience is the easy part, but most organizations fail miserably in communicating expectations and measuring individual effort. If your organization also falls in this category, it is advisable to avoid vast differences based on pay for performance programs. Do remember, Status & Fairness matter a lot to employees. Having said that, do not solve all your people problems with financial incentives. Pay may be the reason why employees leave the organization. But it´s not the reason why they stay. Bad bosses. Gallup in their survey report on attrition has identified bad bosses as the number one reason for the employee to leave the organization. There is an acute shortage of competent leaders. One of the unfortunate consequences of the rapid growth of Indian industry in the last couple of years is the fact that organizations have assigned employees with inadequate experience and competency to leadership roles. These leaders are poor role models for their direct reports and cause more harm than good. Training and coaching are suitable intervention to arrest this situation. Unfortunately, leadership skills cannot be learnt in classrooms. It has to be practiced. It´s important to have systems in place to identify future leaders in the organization and assign appropriate leadership responsibility. Besides classroom training, which provide useful tips, they should also be assigned mentors who can coach and provide timely feedback. Lack of growth opportunity is a major factor for employees to look for other employment options. Promotion is only one option to address this issue. You can´t promote everyone, but you can provide challenging tasks, greater responsibility and more learning opportunities. A suitable mix of OTJ and class room training should be provided. Employees view growth not only in terms of promotion but also in terms of increased knowledge and skill levels. Providing formal and informal feedback in a timely manner provides the employees necessary inputs to grow and succeed in their current roles. It´s a strong indicator to the employees that the organization cares about their growth. Lack of recognition. Recognition can be provided in many ways: Appreciating individual/team achievements. A word of appreciation from the immediate boss or peer has the most impact. Appreciation/recognition should be for a specific behaviour or achievement. Appreciation can be verbal or written. It can also take the form of a certificate or reward in cash/kind. Celebrating successes. Team get-together on successful project/milestone completion.Rewarding longevity. Prize and certificate to employees who complete 3/5/10... years in the organization.Birthday celebrations. Choices are: Card/Bouquet/Movie ticket/Cake cutting with team members in the cafeteria.Annual day celebrations. A word of caution. The organization´s Reward & Recognition (R&R) plan can be a double edged sword. It provides an immediate high to employees who are recognized and demoralizes those who don´t know why they were not considered. So, it´s important that the R&R plan is based on explicit criteria, well communicated and understood by the employees. Avoid programs such as "Employee of the month", based on round robin format. Poor fitment. Employees are more prone to leave the organization in their first year of employment. The main reason is their inability to adapt to the culture of the organization and expectation mismatch. During recruitment process, the recruitment team should evaluate the candidate for cultural fit. Some organizations have loose structures and require employees to have a high level of initiative to operate in an ambiguous environment. Employees who prefer a more structured environment and clear expectations may find it difficult to adjust. The recruitment team should also clearly communicate what the candidate can expect from the organization. It´s not uncommon for a candidate to be promised something which is not met when the candidate joins the organization. The candidate may have joined the organization based on the expectation that he may work on a specific project or technology, and when that expectation is not met, he may get disillusioned andleave the organization. The recruitment team should be sufficiently trained to identify appropriate candidates. Lack of work-life balance. In the race to stay ahead of the competition and satisfy unreasonable customer expectations, organizations are prone to bite more than they can chew. Management may bid for projects at extremely tight timelines. Employees are then expected to stretch themselves to meet these unrealistic timelines. Working late nights and on weekends becomes the norm rather than exception. This may lead to frustration, bickering, and in extreme cases - employee burn out. Providing training and introducing processes for better project estimation and assigning additional resources in projects may be some of the steps to address this issue. Providing stock option, concierge service, canteen facility, transportation for pickup and drop, group medical insurance (for employees and family members, including dependent parents), accident & disability insurance cover, flexi timing, free annual medical check up, subsidized loan, and option for young mothers to work from home are some of the benefits to ensure an engaged workforce. You could build on these ideas to create your retention strategy. It is important to understand that your plans only have a chance of success, if your CEO is convinced of your suggestions. This means that the CEO sets the example by practicing the process. If a culture of fairness is what the organization is professing, then the CEO should not only be fair in all his decisions, but also be perceived to be fair by all the employees. If you are suggesting a process for systematic recognition, then the CEO has to set the ball rolling by being the first practitioner of this process and the practice will automatically cascade down. HR function can only be a facilitator and trustee of the process. Retention is everyone´s responsibility.

6 CPC Calculators

Some Calculators for you........

http://www.staffcorner.com/

http://www.gconnect.in/index.php?option=com_content&view=article&id=437:new-pay-and-arrears-calculators-based-on-approved-pay-commission-report&catid=63:6pc-matters&Itemid=125

SIXTH PAY COMMISSION REPORT FOR DEFENCE PERSONNEL

IMPLEMENTATION OF THE SIXTH PAY COMMISSION REPORT FOR DEFENCE PERSONNEL.
The revised report as recommended by the Anomalies committee and as approved by the Union Cabinet is out.
What it means for the military is this:1. As reported months earlier on this blog, Colonels and Brigadiers are now to be shifted to Pay Band-4. But status wise this does not mean much for the forces since the equivalent (and lower) civil posts have also been shifted to Pay Band-4. To take an example, the post of Superintending Engineer (SE) in the Central Engineering Services, which is equivalent to a Lt Col, has also been granted Pay Band-4 as has been granted to a Full Colonel. Interestingly, the modified report with much fanfare announces that Colonels and Brigs have been shifted to PB-4 of Rs 39200-67000. But if we go on and read the fine print, we find that civilians of equivalent and lower grades have also been placed in the same grade. As described above, an SE of the Central Engineering Services or a Director Govt of India who were in the 5th CPC pay grade of Rs 14,300-18,300 have been put in PB-4 (Rs 39,200-67,000) while a Lt Col who was receiving more pay and was in a higher 5th CPC pay grade of Rs 15,100-18,700 has been placed behind them to languish in PB-3 (Rs 15,600-39,100). Same is the case with Addl Commissioners of Income Tax, Addl Commissioners of Central Excise and Scientists 'E', all of whom were drawing a lesser pay than a Lt Col - and all of whom have now been placed in PB-4 thereby not only bypassing our Lt Colonels in pay but also in status. Hence, service personnel need not be very happy by the illusory upliftment of the grades of Colonels and Brigadiers as far as status is concerned since the same has been applied to civilians too – nothing special has been done for the Army in this case. Of course, monetarily speaking, the figures are not bad since MSP of Rs 6000 and the respective grade pays would be added up into the pay of officers, it is only the status equation which has been disturbed. There are also indications that PB-4 is going to be rehashed and the starting figure (Rs 39,200) may be decreased by about Rs 2000.2. MSP for PBOR doubled to Rs 2000/-.3. Lt Generals overlooked for appointment as Army Commanders (GOsC-in-C) due to lack of residual service would now be granted the Army Commander’s Grade of Rs 80,000/- (fixed) that is also granted to Secretary to Govt of India. MSP of Rs 6000 to be taken into account notionally w.e.f 1-1-2006 while fixing the new pay of Maj Generals and Lt Generals. What is not highlighted is the fact that Directors General of Central Police Organizations who feature on Article 25 of Warrant of Precedence (WoP) have also been granted a scale of Rs 80000 which is more than the one granted to our Lt Generals who feature on Article 24 which is higher than Ds G CPOs. Directors General of State Police and Principal Chief Conservators of Forests also granted a higher scale of Rs 80000. Needless to say, both of these posts, i.e., DGP and PCCF do not feature at all in the WoP.4. Lower limit of Disability Pension raised to Rs 3100. War-Injury pension to be 60% of emoluments.5. SF Allowance for Army/IAF to be equivalent to Marine Commando Allowance of Navy.6. Assured Career Progression Scales in 8, 16 and 24 years for PBOR as opposed to 10,20 and 30 years on the civil side.7. No change in retirement age.
8. Revised scales effective from 1-1-2006 while allowances effective from 1-9-2008.
9. Arrears to be paid in two installments, the first (40% of arrears) this year and the second (60%) in the next financial year.
10. Annual increment to be 3%
11. Increase in Transport Allowance for all.No information is yet available on Grade Pays. Grade Pay recommendations would be very vital since it is now the only determinant of status vis-à-vis civil services.

12 MUST DOS TO REDUCE TAX FILING STRESS

12 MUST DOS TO REDUCE TAX FILING STRESS

We all need to be congratulated for surviving another tax season. As in the previous years, many of us must have rushed in on the last day and somehow managed to submit the income tax return forms. And like before you would have told yourself "I won't go through all this again next year". But then the year will roll on, you will get busy, and tax matters will get pushed back as out of sight is out of mind. By 31 July 2009, when you would be filing tax returns for the assessment year 2009-10, advance preparation in this financial year 2008-09 itself can help you avoid the last-minute anxiety. Here are 12 must dos to reduce tax filing stress next year. Look out for refund Income tax authorities are supposed to send you the refund either electronically directly to your bank account, or by cheque to your address within 30 days of filing the return. Ideally, give 45-90 days for this to happen. Get in touch with the authorities in writing if the delay is longer. Estimate the tax bill For the current year, first estimate your tax liability. You may contact your account department to get a fix on the figure. Budget 2008 increased the income slabs, giving a relief of Rs 4,000 to every taxpayer. For an individual not a woman or a senior citizen, whose taxable income was Rs 800,000 in the previous year, the tax liability was Rs 1,94,670. Now, it is Rs 1,49,350. A net yearly savings of Rs 45,320. Reimbursements As a part of your salary, you may get a reimbursement of medical expenses incurred by you on yourself and your family - Rs 15,000 would be tax-free per annum. You need to give bills or other documents to claim the amount. Preserve them carefully. Leave travel allowance is paid every year, but it is tax-free only for two trips in a block of four years. The blocks are 2002-2005, 2006-2009 and so on. You may have to pay tax this year even after submitting the bills. Organise and keep documents handy Some investment-related proofs, such as statement of account of ELSS funds, can be stored electronically. Remember that interest income earned on all your savings bank accounts also needs to be disclosed and tax paid on them. Close dormant accounts and reduce tax liability. Collect all your bank statements and TDS certificates, if any. This will help you calculate your earning from bank interest. Deposit advance tax if required. If you are claiming deduction on interest paid on an educational loan, collect a certificate of repayment for this financial year in which the interest is stated separately. Do the same for your home loan. If you are claiming deduction for house rent allowance on actual rent paid, collect and keep the rent receipts. For any donations given to an approved charity, get a receipt and also a certificate that the trust gets deduction under Section 80G. If you are claiming a deduction for any medical disability under Section 80U, get a certificate of disability from the authorised doctor. If you got any gifts during the year, collect the gift deeds in your favour, which should clearly state that you received money without any consideration. Keep all the receipts of contributions made towards health insurance, or to schemes under Section 80C such as LIC [Get Quote] payment receipts, copy of the PPF pass book, and children's tuition fee receipts, among others. Health for all Even before thinking of any tax-saving investments, ensure adequate health cover for your family. Further, to the ded-uction of up to Rs 15,000, from this year you will get additional deduction of Rs 15,000 if your parents are also covered, and Rs 20,000 if they're senior citizens. Pay in advance If your employer does not deduct tax at source and your total tax liability this year is above Rs 5,000, you will have to pay tax in advance. Keep a copy of the challan safely for future reference. Use capital losses If you have sold any stocks at a loss, you can book a short-term capital loss, which can be set off against any capital gain - long- term or short-term. If you have made any short-term capital gain during the year, you can set off the loss against the gain. If you book a long-term loss, it may not be of much use as it can be adjusted only against long-term gains, which are not taxable for shares. Declare investments Send all the details to your accounts department in the form of an investment declaration. This document normally states all the tax- saving investment and expenses you plan to undertake this year. This will allow your account department to calculate your taxes. Based on this, tax will be deducted at source. Figure out the existing outgo Work towards bringing down your tax outgo. Before blindly investing in tax-saving avenues, figure out how much tax you are already saving. For salaried employees, 12 per cent of the basic salary goes towards Employees' Provident Fund, which qualifies for tax benefit. Life insurance premiums are also on the same list. Further, principal repayments up to Rs 100,000 on existing home loans get tax relief under Section 80C and interest payments up to Rs 150,000 qualify for tax deduction under Section 24. Another deduction could be on the tuition fees, up to Rs 100,000, that you pay for a maximum of two children. Add these figures to see how much of your tax liability is already covered. Get the old Form 16 If you have moved jobs anytime after 1 April 2008, take a copy of the Form 16 from your previous employer. If you don't, you will lose the advantage of tax exemption. Taxable income is the aggregate of all income received during the year. If your earlier employer has not deducted any tax from your salary, you may get a salary certificate from him indicating the amount received by you as salary during the financial year. Choose tax-savers Choosing your tax-saver heads under Section 80C should depend on its time horizon and your risk appetite. An increase in EMI or loan tenure is likely for floating rate home loans. Try to prepay the loan, either in parts or in a lump sum. These payments will also help you cut down your tax liability. For an equity-linked saving scheme, invest systematically to avoid a last-minute dash. The final moments Most employers ask for actual proof of investment and expenses by the first week of February. Once these documents are given, wait till May 2009 for the Form 16, based on which you can file your income tax return for the next year by 31 July 2009.

6th Pay Commission

Today the Cabinet broadly accepted the recommendations of the Sixth Central Pay Commission with minor modifications. The jump in pay would be upwards of 30 per cent after taxes. The system of four Pay Bands with 20 Grade Pays recommended by the commission has been accepted.
The median salary for central government employees in India currently stands at Rs 250,092 per annum, while the same for those working with private sector companies is Rs 408,605. This will rise to Rs 352,611 per year — which would leave a small gap of Rs 50,000 compared with that of the private sector companies.
But, most private sector companies revise their pay scales after adoption of government pay commission reports, as has been the case in the past. This could again expand the gap between the salaries of private and public sector employees.
So far the highlights of the report are
Minimum basic Salary - Rs. 7000
Education Allowances for employees for upto two children - Rs. 1,000 (Earlier, it was Rs. 100)
Maximum Basic Salary - Rs. 90,000 (Cabinet Secretary)
National Holidays - 3
Gazette Holidays to be canceled
Pay hike will be implemented from January 01, 2006
Maternity Leave : 6 Months
HRA in A-1 Cities - 30% (Unchanged)
HRA in A, B, B-1 Cities - 20%
Incentive Schemes to be announced
New Medical Insurance Scheme to be launched for government employees
Market-driven pay for scientists and all other jobs that require professional skill set.
Total number of salary grades to be reduced from 35 to 20.
The wage hike would increase the financial implication for the Centre by Rs 17,798 crore annually and the arrears with effect from January 2006 would cost Rs 29,373 crore, Information and Broadcasting Minister P R Dasmunsi told reporters after the Cabinet meeting.
The government increased the minimum entry level salary of a government employee to Rs 7,000 against Rs 6,660 recommended by the Commission headed by Justice B N Srikrishna who submitted the report in March this year.
Consequently, it would push up the total emoluments of an employee at the lowest level beyond Rs 10,000 per month including allowances.
It also increased the rate of annual increment from 2.5 per cent to 3 per cent.
In the defence sector, it approved at least three assured promotions for all defence forces personnel and civilian employees under the modified Assured Career Progression scheme.
While civilians would get this after 10, 20 and 30 years of service, defence forces jawans would be promoted under ACP after 8, 16 and 24 years.
The hiked salary would be given to the employees beginning September this year and the arrears from January 2006 would be given in cash in two installments - 40 per cent this fiscal and 60 per cent in 2009-10.
The financial implication of Pay Commission on the General Budget would be Rs 15,717 crore and Rs 6414 crore on Railway Budget in 2008-09.
The government’s present salary bill is over Rs 70,000 crore and the pension bill is over Rs 30,000 crore.
Finance Minister P Chidambaram said the budget deficit target would be adhered to, despite the implementation of the Pay Commission recommendations.
The government for the first time approved Military Service Pay for armed forces personnel, under which officers would get Rs 6,000 over and above their pay per month.
The lowest limit of disability pension for defence personnel would be doubled to Rs 3100 a month.
No Cabinet Secretary rank for Intelligence Bureau chief, the three Service chiefs or the Chairman, Railway Board
Group D personnel to stay (peons in ministries and porters in Railways)
Military service pay for persons below the officer rank (POBR) would be Rs 2,000 per month
Significant hike in salaries of Brigadiers: they move to Pay Band 4 (Rs 39,200-67,000) from the suggested Pay Band 3 (Rs 15,600-39,100)
DIG-scale abolished in IPS and Indian Forest Service
The salaries of Brigadiers will be in Pay Band 4 (Rs 39,200-67,000) as against the suggested pay band 3 (Rs 15,600 - 39,100) previously.
It is expected that the actual pay-out would come in November after the monsoon session of Parliament in September passes the Finance Ministry’s supplementary Demand For Grant to fund the wage bill.