3rd PRC Report Recommendations approved by Government in a Cabinet meeting
The central government had already implemented the 7th Pay commission for all govt employees. But the 3rd PRC which is applicable to Public sector undertaking is yet to be implemented by the top authorities. As the 3rd Pay revision committee has submitted the report to Government 4 months back hence the expectation of CPSEs employees are high about the implementation of pay revision. In this regard, a meeting between the committee of secretaries took place at Cabinet Secretariat, Rashtrapati Bhawan on 12 May 2017.
The CoS has suggested some minor changes in the proposed pay revision And finally central government has approved the 3rd PRC recommendations as endordorsed by CoS in a cabinet meeting. The same may be issued very soon by Department of Public Enterprises through an official order. Here is the list of the decision taken by Government through the Committee of Secretaries on the 3rd Pay revision committee report.
The Committee Recommended that the additional financial impact in the year of implementing the revised pay-package for Board level executives, Below Board level executives and Non-Unionized Supervisors should not be more than 20% of the average Profit Before Tax (PBT) of the last three financial years preceding the year of implementation.
|Additional financial impact of the full revised pay|
package as a % of average PBT of last 3 FYs
(% of BP+DA)
|Financial impact will be within 20% of average PBT of last 3 years||15%|
|More than 20% but upto 30% of average PBT of last 3 FYs||10%|
|More than 30% but upto 40% of average PBT of last 3 FYs||5%|
|More than 40% of average PBT of last 3 FYs||Nil|
The CoS has accepted the affordability condition as prescribed in the report. However, in the case of Coal India and its subsidiaries will be considered single unit. That means all the employees of loss making PSUs like BSNL, MTNL, Air India, SAIL, etc would not get benefited this time.
CoS has recommended going with the proposed fitment benefit of 15% provided that the drop in an average of 3 years PBT should not be more than 20%.
3rd PRC Pay Scales
The CoS has decided to accept the proposed revised pay scales structure suggested by the 3rd PRC Committee. Currently, there are 10 grade in the executive cadre and corresponding to each grade there is a unique pay scale. Here are the revised pay scales of CPSE which will be effective from 01.01.2017
|Grade||Existing Pay Scale||Recommended Pay Scale||Applicable Schedule of CPSE|
|E0||12600-32500||30000-120000||A, B, C, D|
|E1||16400-40500||40000-140000||A, B, C, D|
|E2||20600-46500||50000-160000||A, B, C, D|
|E3||24900-50500||60000-180000||A, B, C, D|
|E4||29100-54500||70000-200000||A, B, C, D|
|E5||32900-58000||80000-220000||A, B, C, D|
|E6||36600-62000||90000-240000||A, B, C, D|
|E7||43200-66000||100000-260000||A, B, C|
100% IDA Neutralization, Annual increment
The CoS has approved the 3% of basic pay for the purpose of annual increment and promotional increment. It also has given the nod for the 100% IDA neutralization for calculating the fitment benefit for existing employees. It means the IDA rate at the time of 31.12.2016 will be merged with the basic pay. Here is the formula for calculating the revised basic pay:
|A||B||C||D (Revised Basic Pay w.e.f. 01.01.2017)|
|Basic Pay +|
(Personal Pay /
Special Pay not
to be included)
Allowance (IDA) as
applicable on 1.1.2017
[under the IDA pattern
linked to All India
Cumulative Price Index
(AICPI) 2001=100 series]
to the next
House Rent Allowances
As the decision of HRA for the 7th Pay Commission is yet to be made by the Government of India. Hence CoS has decided to keep the HRA rates in lines with the 7th CPC order. In mean time HRA may be paid as per old rates on pre-revised pay scales.
Perks and Allowances
We know that this time the pay revision committee has suggested the lower perks for which ceiling is 35% of Basic Pay. The ceiling of perks in CPSEs will further enhance by 25% on increase of IDA by 50%.
Performance Related Pay
PRP is actually a variable pay which depends on the performance of Company, Unit & Employee. The CoS has accepted the Performance Related pay criteria proposed by the 3rd PRC.
The 3rd PRC has recommended increased Gratuity limit from 10Lakh to 20Lakh. It also proposed the separate funding for the addition 10 lakh amount. The CoS has approved the higher Gratuity limit but it has rejected the creation of separate funding for additional Gratuity amount.