CPSE Pay Revision 2017 – Perks and Allowances
Perks & Allowances
The Committee, after examining the perks & allowances under the revised compensation structure in a holistic manner and based on the deliberations held with the CPSEs, recommends that Board of Directors of the CPSEs shall be empowered to decide on the perks & allowances that can be provided to the executives / non-unionized supervisors subject to the following broad parameters:
i. The CPSEs can provide to their executives / non-unionized supervisors the perks & allowances, preferably to choose from the set of the perks & allowances under the concept of ‘cafeteria approach’, the value of which can be upto the ceiling of 35% of Basic Pay. The ceiling is further recommended to be partially linked to the Industrial Dearness Allowance (IDA) in future, and thereby the CPSEs will be allowed to enhance the ceiling by 25% [of 35% of BP (i.e. by 8.75% of BP)] whenever IDA rises by 50%.
ii. The Committee noted that the CPSEs are operating at distant locations spread across the country, and in the process have created the infrastructure facilities such as hospitals, colleges, schools, clubs etc. as a social obligation & welfare measure to meet the basic needs of the employees posted / transferred at such locations. Many of such infrastructure facilities like hospitals, schools, etc. are also in the nature of quasi-public facilities serving the surrounding public needs. These infrastructure facilities are also commonly utilized by both executives and unionized workmen, however under extant guidelines the charging of recurring expenditure on maintaining & running the infrastructure facilities within the perks & allowances ceiling is mandated only for the executives. The Committee is therefore of the view that such infrastructure facilities should be encouraged for functioning of the CPSEs in harmony as a necessity of industries to function; and thus recommends that the cost incurred on infrastructure facilities is not to be charged within the recommended ceiling on perks & allowances.
iii. The Committee also took cognizance of the fact that it is crucial for the CPSEs to create housing facilities for its employees at different locations, which are provided in the form of Company owned accommodations in Townships, or otherwise; and thus in the interest of the CPSEs it is viewed that such facilities need to be utilized and well maintained. The employees who are working at a location and staying in Company owned accommodation, have to bear the tax arising out of the perquisite value of the said accommodation. There are CPSEs who also reported that the Company owned accommodation / quarters are lying un-utilized. In consideration of the submissions made by the CPSEs, and also taking note of the provisions under the Income Tax Act that allows the employer to incur certain expenditure on behalf of employees (like bearing the tax on ‘non-monetary perquisites’ as provided under Section 10(10CC)* of Income Tax Act), the Committee recommends that the CPSEs would have the flexibility to avail such provision under Income Tax Act that enables the employer organization to bear such tax in respect of Company owned accommodation on behalf of executives / nonunionized supervisors; however 50% of such expenses borne shall be loaded within the prescribed ceiling on perks & allowances.
Authority: 3rd PRC Report
CPSE Pay Revision 2017 – Fitment Benift and Methodology – Click to read more
CPSE Pay Revision 2017 – Calculation of Annual Increment – Click to read more
CPSE Pay Revision 2017 – Dearness Allowance Calculation – Click to read more
CPSE Pay Revision 2017 – Rates of House Rent Allowance (HRA) – Click to read more
CPSE Pay Revision 2017 – Perks and Allowances – Click to read more
CPSE Pay Revision 2017 – Retirement Age Recommendations – Click to read more
CPSE Pay Revision 2017 – Bunching of Pay – Click to read more
CPSE Pay Revision 2017 – Retirement Benefits – Click to read more
CPSE Pay Revision 2017 – Voluntary Separation Scheme (VRS) – Click to read more
CPSE Pay Revision 2017 – Leave Regulations – Click to read more
CPSE Pay Revision 2017 – Leased Accommodation – Click to read more