A PROJECT REPORT ON

WAGES AND SALARY ADMINISTRATION & MORALE OF THE EMPLOYEE IN ONGC Ltd.

SUBMITTED FOR THE PARTIAL FULFILMENT OF MASTER OF BUSINESS ADMINISTRATION (2012-2013)

UNDER EXTERNAL GUIDANCE OF:MR. M.S. KUSHWAHA

Chief Manager (HR)ONGC, TEL BHAVAN, DEHRADUN

SUBMITTED BYPRIYA PHUTELA

MBA- IV SEM ( HUMAN RESOURCE MANAGEMENT)ROLL NO. - 571114729

SIKKIM MANIPAL UNIVERSITY, DIRECTORATE OF DISTANCE EDUCATIONLEARNING CENTRE:- INTERNATIONAL ACADEMY OF INFORMATION

TECHNOLOGY (IAIT), LC CODE – 01004, RAJPUR ROAD, DEHRADUN

ACKNOWLEDGMENT

I am grateful to the God Almighty to provide me wisdom and health to complete this project

work. I am also thankful for the inspiration and unconditional support of my parents.

I would like to thank all my faculty members at IAIT, Dehradun and all those people at ONGC

who directly or indirectly help me making this project a success.

PRIYA PHUTELAMBA 4th Semester (HRM)Batch: 2012-2013ROLL NO. – 571114729SMU-DE, IAIT STUDENTRAJPUR ROAD, DEHRADUN.

CONTENTS

Acknowledgement

Chapter One

Executive Summary

History of ONGC Ltd.

HR Mission and Vision

Recognition & Awards

Chapter Two

Wages and Salary Administration

Theory of Wages

Payment of Wages Act, 1936

Components of Wages

Chapter Three

Morale of the Employee

Types of Morale

Building of Morale

Measurement of Morale

Chapter Four

Research Methodology

Significance of study

Research Objective

Sampling Method

Limitations

Chapter Five

Statistical Analysis of Questionnaire

with conclusion

Chapter Six

Major Findings

Recommendations

Chapter Seven

Annexure - Questionnaire

Bibliography

EXECUTIVE SUMMARY

Oil and Natural Gas Corporation Limited (ONGC) is engaged in the business of exploration and

drilling of crude oil and natural gas and is the world’s second biggest exploration and production

company ONGC owns and operates more than 11000 kilometers of pipelines in India, including

nearly 3200 kilometers of sub-sea pipelines. The company contributes more than 78% of India’s

oil and gas production.

Today, ONGC is the flagship company of India; and making this possible is a dedicated team of

nearly 40,000 professionals who toil round the clock. It is this toil which amply reflects in the

performance figures and aspirations of ONGC. The company has adapted progressive policies in

scientific planning, acquisition, utilization, training and motivation of the team. At ONGC

everybody matters, every soul counts.

ONGC has a unique distinction of being a company with in-house service capabilities in all the

activity areas of exploration and production of oil & gas and relate oil field services.

Needless to emphasize, this was made possible by the men & women behind the machine. Over

18,000 experienced and technically competent executives mostly scientists and engineers from

distinguished Universities / Institutions of India and abroad form the core of our manpower.

They include geologists, geophysicists, geochemists, drilling engineers, reservoir engineers,

petroleum engineers, production engineers, engineering & technical service providers, financial

and human resource experts, IT professionals and so on.

This report concentrates on the study of the Compensation And Benefits Policies being practiced

in ONGC.

"ONGC, the most valuable company in India by market capitalization, is on a high

growth trajectory. It is on its way to be a truly integrated oil and gas player."

- Jigar Shah, Head, Research Wing, KR Choksey Shares & Securities Pvt Ltd.

"In the coming six to seven years' time, one would see ONGC on an assured

growth path. It should have increased production and recovery factor, reserve

accretion, best-in-class technology, competent, motivated human resource and

strong financials. I would like ONGC to meet India's hydrocarbon needs to the

maximum possible extent. I would also like to see ONGC recognized within and

outside the country, for its competencies and achievements. We should be accepted

globally as one of the best E&P companies."

- Subir Raha, Ex Chairman & Managing Director, ONGC

HISTORY :

1947-1960:

During the pre-independence period, the Assam Oil Company in the northeastern and Attack Oil

Company in northwestern part of the undivided India were the only oil companies producing oil

in the country, with minimal exploration input. The major part of Indian sedimentary basins was

deemed to be unfit for development of oil and gas resources.

After independence, the National Government realized the importance of oil and gas for rapid

industrial development and its strategic role in defense. Consequently, while framing the

Industrial Policy Statement of 1948, the development of petroleum industry in the country was

considered to be of utmost necessity.

In 1955, Government of India decided to develop the oil and natural gas resources in the various

regions of the country as part of the Public Sector development. With this objective, an Oil and

Natural Gas Directorate was set up towards the end of 1955, as a subordinate office under the

Ministry of Natural Resources and Scientific Research. The department was constituted with a

nucleus of geoscientists from the Geological survey of India.

In April 1956, the Government of India adopted the Industrial Policy Resolution, which placed

mineral oil industry among the schedule ‘A’ industries the future development of which was to

be the sole and exclusive responsibility of the state.

1961-1990:

Since its inception, ONGC has been instrumental in transforming the country’s limited upstream

sector into a large viable playing field, with its activities spread throughout India and

significantly in overseas territories. In the inland areas, ONGC not only found new resources in

Assam but also established new oil province in Cambay basin (Gujarat), while adding new

petroliferous areas in the Assam-Arakan Fold Belt and East coast basins (both inland and

offshore). Subsequently, over 5 billion tones of hydrocarbons, which were present in the country,

were discovered. The most important contribution of ONGC, however, is its self-reliance and

development of core competence in E&P activities at a globally competitive level.

After 1990:

The liberalized economic policy, adopted by the Government of India in July 1991, sought to

deregulate and de-license the core sectors (including petroleum sector) with partial

disinvestments of government equity in Public Sector Undertakings and other measures. As a

consequence thereof ONGC was re-organized as a limited Company under the Company’s Act,

1956 in February 1994.

In the year 2002-03, after taking over MRPL from the A V Birla Group, ONGC diversified into

the downstream sector. ONGC will soon be entering into the retailing business. ONGC has also

entered the global field through its subsidiary, ONGC Videsh Ltd. (OVL). ONGC has made

major investments in Vietnam, Sakhalin and Sudan and earned its first hydrocarbon revenue

from its investment in Vietnam.

ONGC, one of the Navaratana Public Sector Companies is India’s natural Oil Exploration and

Production Company. It was established in 1956 as the Oil and Natural Gas Commission as an

immediate consequence of the Industrial Policy Resolution of 1956, which laid the basis for

industrial Development in free India with emphasis on public sector led growth.

Inspired by the spirit of Self Reliance and backed by the government policies the ONGC enabled

India to break the shackles of the International Oil Majors whose exploration and production

goals in India were determined by their global

interest rather than by any interest in finding, developing and producing from oilfields in India.

In India, oil was first discovered Digboi, Assam in the late 19 th century. In 1921, United

Kingdom based Burmah Oil Company took over the Assam Oil Company, which control the

oilfields and the only refinery in India, which situated in the area. In 1931, about 2.5 lakhs tones

of oil was produced from the oil fields there. After Independence, multinational companies such

as Royal Dutch Shell, Standard Oil and Burmah Oil were invited to explore for oil but they

insisted that there was no oil available outside the Assam tracts.

An important aspect of the ONGC programme was the use of Soviet and Romanian assistance in

Oil Exploration Projects. An agreement with the Soviet Union for an offshore seismic enabled

the collection of data from the Gulf of Cambay, the Arabian Sea and the East Coast. Oil was

struck in Bombay High stabilized in 1976-77 and increased rapidly until 1983-84, but has

declined since then.

The ONGC is among the best managed and the most efficient public sector enterprise in India. It

leads India’s efforts to develop its petroleum resources in ONGC.

Established in 1956, as the oil and natural gas commission, ONGC acquired a new corporate

identity on February 1st 1994 to become the OIL AND Natural Gas Corporation Limited. ONGC

has its operations spread all over the country, both on land and offshore. Exploration to

extraction, it has its enterprise diverse facets of the Petroleum Industry including Technical and

Consultancy Services. Powered by highly trained and motivated workforce of 33810, ONGC has

contributed around 5500 million barrels of oil equivalent of gas to the petroleum industry of

India and today produces one billion boe per day.

ONGC is now a major player in the nation’s corporate arena with a commendable turnover of

around Rs.569037 million in 2006-07 with accumulated capital employed of around turnover

Rs.540744 million.

Positioned at the very nucleus of India’s economic pulse, ONGC has a corporate mission that

envisages development of hydrocarbons in an environment friendly manner. Its objectives aim at

self reliance in technology and a holistic perspective on energy, for the nation’s progress.

The new identity as a corporation not only helps ONGC mobilize resources from the capital

markets but also offers greater flexibility in conducting its business.

VISION, MISION & OBJECTIVES OF ONGC

VISION:

“To be world class OIL AND GAS COMPANY integrated in energy business with dominant

Indian leadership and global presence.”

A New Vision

MISSION:

Dedicated to excellence by leveraging competitive advantages in R&D and technology

with involved people.

Imbibe high standards of business ethics and organizational values.

Abiding commitment to health, safety and environment to enrich quality of community

life.

Strive for customer delight through quality products and services.

Focusing on domestic and international Oil and Natural Gas exploration and production

business opportunities.

Dominant Indian Leadership.

Creating growth and maximizing shareholder value.

Retaining dominant position in the Indian Petroleum sector and enhancing India’s energy

availability.

ONGC Objectives:

Optimize Production of Hydrocarbons.

Self Reliance in Technology.

Promoting indigenous effort in Oil and Gas related equipment material and services.

Assist in conservation of hydrocarbons, more efficient use of energy and development

of alternative sources of energy.

Develop scientifically oriented and technically competent human resources through

motivation and training.

SPECIALISATION AREAS OF ONGC :

1. Geochemical studies, Bio-stratigraphic analysis.

2. Basic evaluation, prospect generation and techno economic analysis.

3. Formation evaluation and reservoir modeling.

4. Application of secondary recovery and EOR techniques.

5. Estimation of reservoir and reserves.

6. Drilling operations including horizontal and drain hole.

7. Well loading operations.

8. Reservoir Management.

9. Design erection and maintenance of oil and gas production installation.

10. Artificial lift design. Down hole completion system.

11. Stimulation Techniques.

12. Long distance transportation of oil and gas.

13. Erection and maintenance of oil sweetening plants.

14. Corrosion studies in offshore structure.

15. Training of Manpower.

16. Engineering and Construction of offshore, platforms and manpower.

17. Equipment Management and quality assurance.

18. Safety, audit and environment studies.

VARIOUS INSTITUTES OF ONGC :

Following are the very important institutes of ONGC:

1. GEOPIC: Geo data processing and interpretation centre (GEOPIC), DEHRADUN, and

Seismic Data Processing with interactive facilities and taste of the art 3D processing

supported by 4 regional computers centers.

2. ONGC ACADEMY: Earlier known as Institute of Management Development (IMD)

DEHRADUN, for training and development.

3. KDMIPE: Keshav Deva Malaviya Institute of Petroleum Exploration (KDMIPE),

DEHRADUN, developed to all aspects of exploration.

4. IDT : Institute of Drilling Technology (IDT), DEHRADUN, helping in effective drilling

operations, drilling fluid engineering and cementation research.

5. IEOT: Institute of Engineering and Ocean Technology (IEOT), DEHRADUN, Structures

geo-technical concept evaluation and hydrocarbons.

6. IOGPT : Institute of Oil and Gas Production Technology (IOGPT), PANVEL,

MUMBAI, improving production technology.

7. IPSHEM : Institute of Petroleum Safety, Health and Environment Management, GOA.

8. IRS : Institute of Reservoir Studies (IRS), AHMEDABAD, where reservoir studies are

going in process.

AREAS OF ACTIVITIES:

The major activities of ONGC comprises of the following:

Survey

Drilling- Exploratory and Development

Production of Crude and Natural Gas

Production of Value Added Products- LPG, Naptha, SKD, Ethane- Propane etc.

Research and Development

STAKES AND SUBSIDIARIES:

MRPL known as Mangalore Refinery & Petrochemicals Limited (71% equity stake)

ONGC Videsh Limited (ONGC’s overseas arm)

Indian Oil Corporation (9.6% equity stake)

Mansarovar Energy Colombia Limited, 50:50 joint venture between OVL and SINOPEC

of China.

ONGC is the only fully-integrated petroleum company in India, operating along the entire

hydrocarbon value chain:

Holds largest share of hydrocarbon acreages in India.

Contributes over 78% of Indian’s oil and gas production.

About one-tenth of Indian refining capacity.

Created a record of sorts by turning Mangalore Refinery and Petrochemicals Limited

around from being a stretcher case for referral to BIFR to the BSE Top 30, within a year.

Interests in LNG and product transportation business.

ORGANISATIONAL SET UP :

ONGC is having a vast set up within the country as well as abroad. This is apparent from the

location structure of the organization within the country as shown in the map below:

MAP OF ORGANIZATIONAL SET UP :

The above set up in accordance with the CRC structure is as follows:

ASSET: ASSAM Asset (it includes offices and projects at Jorhat, Sibsagar, Nazira, Silchar) ;

Bassien and Satellite in Mumbai Offshore; Neelam and Heera in Mumbai offshore;; Tripura

Asset; Rajemundary Asset; Mumbai high Asset; Ankeleshwar Asset; Ahmedabad Asset and

Mehsana Asset.

BASIN: Western offshore basin (it includes Mumbai offshore block, Kuch Saurashtra Block,

Kerala, Kolkan Blocka Deep Water in South of Mumbai offshore) Western On shore Basin (it

includes Cambay, Jodhpur, Ankeleshwar, Mehasana and Ahmedabad); Cauvery Basin; Krishna

Godavari Basin; Assam and Arrakan Basin; Frontier Basin in Himalayan foothills of Jammu;

CBM/BPM/MBP (Coal belt Methane in Bengal Purnia Mahanadi Belt)

PLANT: One at Hazira near Surat where gas is produced. Second one is at URAN which is an

oil and gas producing plant. More than 20 downstream companies including refineries, power

plant and fertilizer industries are dependent upon its supplies.

SERVICES: Companies HSE (Health Safety and Environment); Drilling Services; Engineering

services; Geophysical services; Infocom services; Logging services; Medical services; Offshore

logistic; Security services; Technical services and Well services.

Apart from the above ONGC is also having its presence through its subsidiaries namely

Mangalore Refinery and Petrochemical Limited (MRPL) and ONGC Videsh Limited (OVL) and

Joint Ventures also. ONGC has 71.62% ownership MRPL has made a turnaround performance

since ONGC gas acquired it.

OUR PEOPLE:

Today, ONGC is the flagship company of India: and making this possible is a dedicated team of

nearly 34,000 professionals who toil round the clock. It is this toil which amply reflects in the

performance figures and aspirations of ONGC. The company has adapted progressive policies in

scientific planning, acquisition, utilization, training and motivation of the team. At ONGC

everybody matters, every soul counts. ONGC has a unique distinction of being a company with

in house capabilities in all the activity areas of exploration and production of oil and gas and

related oil field services.

RECOGNITION AWARDS AND ACCREDITATIONS

Global Rankings/ Recognitions : ONGC has been ranked at 152 (up 46 notches than last year’s rank of 198th position) in the

Forbes Global 2000 list 2009 of the world's biggest companies released on 8th April 2009.

Ranking is based on Sales (US$24.04 billion), Profits (US$4.95 billion), Assets (US$35.35

billion) and Market Capitalization (US$28.91 billion). 47 Indian companies find place in the list

among which ONGC has been ranked at no. 3 after Reliance Industries and State Bank of India;

however, ONGC retains number One rank as per profit among Indian companies and has been

ranked at 81 among the global 2000 biggest companies

Golden Peacock Awards ONGC has been declared as the winner of Golden Peacock Award for “Climate Security 2009” as well as

“Golden Peacock Award for occupational Health & Safety 2009”. The awards instituted by Institute of

Directors were decided by a Jury under chairmanship of Mr. P. N. Bhagwati, former Chief Justice of

India and Member, United Nations Human Rights Commission

ONGC receives Dalal Street Investment Journal Award for Highest

Profit among PSUsThe first DSIJ PSU Awards 2009 were given away at a glittering ceremony held at the India

Habitat Centre, New Delhi.

D K Sarraf, Director (Finance), ONGC bags Best Oil & Gas CFO Award

ONGC’s Director (Finance) Mr. D K Sarraf has been adjudged as the Best Chief Financial

Officer in Indian Oil and Gas sector, by CNBC TV-18.

ONGC receives FICCI Annual Award for Environmental

Sustainability of Businesses At the 81st Annual General Meeting of FICCI, Oil and Natural Gas Corporation Limited

(ONGC) was conferred by FICCI its annual award for 2007-08 in appreciation to “Outstanding

Achievement in Environmental Sustainability of Businesses”.

REGIONS AND THE WORK CENTRES OF O.N.G.C :

1. Headquarter with headquarter at Dehradun

Dehradun

Delhi

2. Mumbai offshore Project with headquarter at Mumbai

Regional office, Mumbai

Titan project

Port office

Other establishment in Maharashtra Coast including Kerala, Lakshadweep

offshore

3. Central Region with headquarter at Kolkata

Regional office, Kolkata

Tripura Project

West Bengal Project

Eastern Ganga Valley

Orissa

Madhya Pradesh

4. Eastern Region with headquarter at Nazira

Meghalaya

Arunachal Pradesh

Nagaland

Manipur

Mizoram

5. Northern Region with headquarter at Dehradun

Jammu and Kashmir

Punjab

Haryana

Western Ganga Valley other than Dehradun and Delhi

6. Western Region with Regional office Vadodra

Vadodra

Ankleshwar

Ahemdabad

Cambay

Mehsana

Jodhpur

7. Southern Region with Regional office Chennai

Chennai

Rajahmundary

Karaikal

Hyderabad

BOARD OF DIRECTORS

Shri A. K. Hazarika – CMD & Director (Onshore)

Shri D. K. Sarraf – Director (Finance)

Dr. A. K. Balyan – Director (Human Resource)

Shri Sudhir Vasudeva – Director (Offshore)

Shri D. K. Pandey – Director (Exploration)

Shri U. N. Bose – Director (Technology and Field Services)

Flagship Energy Major :

ONGC has scripted India’s Hydrocarbons saga by discovering 6 of the 7 producing Indian

Basins, in the last 50 years, adding 6.4 billions tones in place oil and gas reserves. ONGC has

established its competitive edge, by bagging mare than 80 blocks (more than 50%) awarded in

the 6 rounds of bidding under the New Exploration Licensing Policy (NELP) of the Indian

Government. It operates around 6 lakhs square kilometer of exploration area holding 60% of

exploration acreage of the country.

ONGC has initiated India’s first deepwater production system to bring deepwater produce to

onshore-India’s first Oil and Gas field with remotely monitored and controlled smart wells.

It owns and operates more than 11000 kilometers of pipelines in India, including nearly 3200

kilometrers of sub-sea pipelines – the longest in India. All the installations of ONGC- India’s

greenest company are certified for Quality, Health, Safety and Environment Management

(QHSE), making ONGC unique in the WORLD in this regard. ONGC is a trend setter for Clean

Development Mechanism (CDM) project, in line with United Nations Framework Convention on

Climate Change.

Biggest Indian Multinational:ONGC’s wholly owned subsidiary ONGC Videsh Limited (OVL) is the biggest Indian

Multinational, with 25 Oil and Gas Projects in 15 countries with total capital employed Rs.10,

000 millions and commendable turnover of Rs. 28,634.94 millions.

NEW ENERGY SOURCES:

ONGC is pursuing a clean coal opportunities systematically through Coal Bed Methane (CBM).

Undergoing Coal Gasification (UCG) and surface coal gasification (SCG) . ONGC is also

associated with National Gas Hydrated Program (NGHP). While remaining focused on Oil and

Gas E&P, it is setting up an Energy Centre at New Delhi for holistic research in New Energy

Sources which can be brought to market. It is also pursuing renewable sources, setting up two 50

MW wind power farms in Gujarat and Karnataka.

ONGC – The First Integrated Petroleum Company in India :

Oil and Natural Gas Corporation Limited (ONGC) contributes up to 80% of India’s oil and gas

production (oil and gas meets around half of India’s energy requirements), and is one of the

largest producers of LPG cooking gas and Naptha.

Cumulative Oil and Gas Production:

Since its inception in 1956, ONGC has cumulatively produced more than 660 million metric

tones (MMT) of crude oil and 350 billion cubic metric (BCM) of natural gas. Today ONGC’s

recoverable reserves in domestic acreages amount to 1.1 billion tones of Oil + Oil Equivalent

Gas (O+ OEG)

CORPORATE GOVERNANCE :

ONGC management continues to strive for excellence in good governance and responsible

management practices, benchmarking with best of global companies.

ONGC has been practicing corporate governance principles much before it become mandatory.

Our company believes that for a company to be successful it must maintain global standards of

corporate conduct towards its stakeholders. The company believes that it is rewarding to be

better managed and governed and to identify its activities with national interest. To that end, our

company has always focused on good corporate governance which is the key driver of

sustainable corporate growth and long term value creation.Company views corporate governance

in its widest sense almost like a trusteeship, a philosophy to be progressed, a value to be imbibed

and an ideology to be ingrained into the corporate culture.

“Not only had India…. Set up own machinery for oil exploration and exploitation… an

Efficient oil commission had been built where a large number of bright young men and

Women had been trained and they were doing good work”.

Pandit Jawaharlal, India’s first Prime Minister to Lord Mountbatten, on ONGC 1999.

Today ONGC is the flagship company of India, and making this possible is a dedicated team of nearly 34,000 professionals who toil round the clock. It is this toil which amply reflects in the performance figures and aspirations of ONGC. The company has adapted progressive policies in scientific planning, acquisition, utilization, training and motivation of the team. At ONGC, everybody matters, every soul counts.

ONGC has a unique distinction of being a company within house service capabilities in all the activity areas of exploration and production and production of oil and gas related oil field services.

Needless to emphasize, this was made possible by the men and women behind the machine. Over 18000 experience and technical competent executives mostly scientist and engineers from distinguish universities / institutions of India and abroad from the core of manpower. This includes geologists, geochemists, drilling engineers, reservoir engineers, petroleum engineers, petroleum engineers, technical service providers, financial and human resource experts, IT professionals and so on.

HR VISION, MISSION AND OBJECTIVES

HR VISION

“To build and nurture a world class Human capital for leadership in energy business.”

HR MISSION

To adopt and continuously innovate best-in class HR practices to support business Leaders through

engaged, empowered, and enthused employees

HR OBJECTIVES

Enrich and sustain the culture of integrity, belongingness, teamwork,

accountability and innovation.

Attract, nurture, engage and retain talent for competitive advantage.

Enhance employee competencies continuously.

Build a joyous work place.

Promote high performance work systems.

Upgrade and innovate HR practices, systems and procedures to global

benchmarks.

Promote work life balance.

Measure and Audit HR performance

Integrate the employee family into the organizational fabric.

Inculcate a sense of Corporate Social responsibilities among employees

HR STRATEGIES To meet challenging demands of the business environment, focus of

the HR Strategy is on change of the employee’s ‘mindset’. Building quality culture and resources. Re-engineering and redeployment for maximizing utilization of HR

potential. RE-strengthening mutual faith, trust and respect. Including a spirit of learning and enjoying challenges.

ROLE OF HR Alignment of HR vision with corporate vision. Shift from support group to strategic partner in business operations Enhances productivity and performance by developing employee

competency and potential. Developing professional attitude and approach. Developing “Global Managers” for tomorrow to ensure the role of global

players.

A MOTIVATED TEAM

HR policies at ONGC revolve around the basic tenet of creating a highly motivated. Vibrant and self driven team .The Company cares for each and every employee and has in-built systems to recognize and reward them periodically.

Motivation plays an important role in HR development. In order to keep its employees motivate the company has incorporated schemes such as Reward and Recognition, Grievance Handling Scheme and Suggestion Scheme.

Incentives scheme to Enhance Productivity Job Incentive Quarterly Incentive Reserve Establishment Honorarium Roll out of Succession Planning Model for identified key position Group incentives for cohesive team working with a view to enhance

productivity.

Wages and Salary

Administration

Traditionally the compensation paid to manual workers is known as wages. It is different from

salary which in economic and accounting terms is paid to non-manual workers. These days even

the manual workers are paid salaries who are employed in the factories.

“Wages are the remuneration for the expenditure of effort in production of goods and services.

The effort of wage earner may be physical, mental or a combination of the two; it may be under

another’s direction or may be of a managerial and decision making character. But whatever his

specific occupation, the wage earner supplies some form of human contribution to production

and wages are reward for his contribution”.

Marshall defines wages “as the rate of pay of common, unskilled labours.” For the worker, no

other feature of industry has more significance than wages, because wages are their sole source

of livelihood. To the employer, the wage level is a matter of vital concern because wage

payments constitute an important item of cost of production.

Wages can also be a source of motivation to employees to perform their duties effectively and

efficiently. The term ‘wages’ has been defined by the payment of Wages Act, 1936 (as amended)

as remuneration in terms of money which would be payable on the basis of the contract of

employment but which does not include the following:-

a) Value of house accommodation, supply of light, water etc.,

b) Contribution by the employer to any pension fund or provident fund,

c) Travelling allowance or value of any travelling concession,

d) Any sum paid to defray special expenses, and

e) Any gratuity payable on discharge unless payable under any law, contract or instrument

which does not provide for the time within which payment is to be made.

THEORY OF WAGES

Over the years, a number of theories have made their mark on the contemporary economic thought of the day, only to be subsequently discarded as being of little value. Existing theories have been pushed aside by theories that fit the new facts of the day better than the old theories. In this sense, a wage theory is relative to a particular place, a particular set of conditions, a particular time, and a particular intellectual climate.

The first, up to 1870, was dominated by the wage fund theory; the second, up to 1914, was the period when the theory of marginal productivity held sway; and the third, extending from the First World War till the present day was characterized by the process of collective bargaining and the Keynesian enquiry into the general wage level and employment.

Subsistence Theory: Given by DAVID RECARDO in the year 1817.Wage Fund Theory: Given by JOHN STUART MILL in the year 1930’Residual Claimant Theory: Given by FRANCIS A. WALKER during 19th century.The Marxian Theory of Surplus Value: This theory is inversion of Residual claimant theoryNational Income Theory: Given by JOHN MAYNARD KENYES in 1930

PAYMENT OF WAGES ACT, 1936

[Act No. 4 of Year 1936]An Act to regulate the payment of wages of certain classes of [employed persons]Whereas it is expedient to regulate the payment of wages to certain classes of[Employed persons];It is hereby enacted as follows: -

1. Short title, extent, commencement and application(1) This Act may be called the Payment of Wages Act, 1936.(2) It extends to the whole of India 3[* * *]].(3) It shall come into force on such 4[date] as the Central Government may, byNotification in the Official Gazette, appoint.(4) It applies in the first instance to the payment of wages to persons employed inAny [factory, to persons] employed (otherwise than in a factory) upon any railway by a railway administration or, either directly or through a sub-contractor, by a person fulfilling a contract with a railway administration, [and to persons employed in an industrial or other establishment specified in sub-clauses (a) to (g) of clause (ii) of section 2.](5) The State Government may, after giving three months’ notice of its intention of so doing, by notification in the Official Gazette, extend the provisions of [this Act] or any of them to the payment of wages to any class of persons employed in 8[any establishment or class of establishments specified by the Central Government or a State Government under sub-clause (h) of clause (ii) of section 2]: PROVIDED that in relation to any such establishment owned by the CentralGovernment no such notification shall be issued except with the concurrence of those governments.(6) Nothing in this Act shall apply to wages payable in respect of a wage-period which, over such wage-period, average one thousand six hundred rupees a month or more.

2. DefinitionsIn this Act, unless there is anything repugnant in the subject or context,-

(i) "Employed person" includes the legal representative of a deceased employed person;(a) "Employer" includes the legal representative of a deceased employer;(b) "Factory" means a factory as defined in clause (m) of section 2 of the Factories Act, 1948 (63 of 1948) and includes any place to which the provisions of that Act have been applied under sub-section (1) of section 85 thereof;]

(ii) "Industrial or other establishment" means any-(a) Tramway service, or motor transport service engaged in carrying passengers or goods or both by road for hire or reward;(b) air transport service other than such service belonging to, or exclusively employed in the military, naval or air forces of the Union or the Civil AviationDepartment of the Government of India;(b) dock, wharf or jetty;(c) Inland vessel, mechanically propelled;(d) Mine, quarry or oil-field;(e) Plantation;

(f) Workshop or other establishment, in which articles are produced, adapted or manufactured, with a view to their use, transport or sale;(g) Establishment in which any work relating to the construction, development or maintenance of buildings, roads, bridges or canals, or relating to operations connected with navigation, irrigation, or to the supply of water or relating to the generation, transmission and distribution of electricity or any other form of power is being carried on.(h) Any other establishment or class of establishments which the Central Government or a State Government may, having regard to the nature thereof, the need for protection of persons employed therein and other relevant circumstances, specify, by notification in the Official Gazette.

(iii) "Mine" has the meaning assigned to it in clause (j) of sub-section (1) of section2 of the Mines Act, 1952 (35 of 1952); [(iii) "plantation" has the meaning assigned to it in clause (f) of section 2 of the Plantations Labour Act, 1951 (69 of 1951);]

(iv) "Prescribed" means prescribed by rules made under this Act;

(v) "Railway administration" has the meaning assigned to it in clause (6) of section 3 of the Indian Railways Act, 1890 (9 of 1890); and [(vi) "wages" means all remuneration (whether by way of salary, allowances, or otherwise) expressed in terms of money or capable of being so expressed which would, if the terms of employment, express or implied, were fulfilled, be payable to a person employed in respect of his employment or of work done in such employment, and includes-

(a) Any remuneration payable under any award or settlement between the parties or order of a court;

(b) Any remuneration to which the person employed is entitled in respect of overtime work or holidays or any leave period;

(c) Any additional remuneration payable under the terms of employment (whether called a bonus or by any other name);

(d) Any sum which by reason of the termination of employment of the person employed is payable under any law, contract or instrument which provides for the payment of such sum, whether with or without deductions, but does not provide for the time within which the payment is to be made;

(e) Any sum to which the person employed is entitled under any scheme framed under any law for the time being in force, but does not include-

(1) Any bonus (whether under a scheme of profit sharing or otherwise) which does not form part of the remuneration payable under the terms of employment or which is not payable under any award or settlement between the parties or order of a court;

(2) The value of any house-accommodation, or of the supply of light, water, medical attendance or other amenity or of any service excluded from the computation of wages by a general or special order of the State Government;

(3) Any contribution paid by the employer to any pension or provident fund, and the interest which may have accrued thereon;

(4) Any travelling allowance or the value of any travelling concession;

(5) Any sum paid to the employed person to defray special expenses entailed on him by the nature of his employment; or

(6) Any gratuity payable on the termination of employment in cases other than those specified in sub-clause (d).

3. Responsibility for payment of wages

Every employer shall be responsible for the payment to persons employed by him ofall wages required to be paid under this Act:

PROVIDED that, in the case of persons employed (otherwise than by a contractor)-(a) in factories, if a person has been named as the manager of the factory under [clause (f) of sub-

section (1) of section 7 of the Factories Act, 1948 (63 of 1948)];(b) in industrial or other establishments, if there is a person responsible to the employer for the

supervision and control of the industrial or other establishments;](c) Upon railways (otherwise than in factories), if the employer is the railway administration and the

railway administration has nominated a person in this behalf for the local area concerned. The person so named, the person so responsible to the employer, or the person so nominated, as the case may be shall also be responsible for such payment.

4. Fixation of wage-periods

(1) Every person responsible for the payment of wages under section 3 shall fix periods (in this Act referred to as wage-periods) in respect of which such wages shall be payable.

(2) No wage-period shall exceed one month.

5. Time of payment of wages:

(1) The wages of every person employed upon or in-

(a) Any railway, factory or 12[industrial or other establishment] upon or in which less than one thousand persons are employed, shall be paid before the expiry of the seventh day,(b) any other railway, factory or 12[industrial or other establishment], shall be paid before the expiry of the tenth day, after the last day of the wage-period in respect of which the wages are payable: [PROVIDED that in the case of persons employed on a dock, wharf or jetty or in a mine, the balance of wages found due on completion of the final tonnage account of the ship or wagons loaded or unloaded, as the case may be, shall be paid before the expiry of the seventh day from the day of such completion.]

(2) Where the employment of any person is terminated by or on behalf of the employer, the wages, earned by him shall be paid before the expiry of the second working day from the day on which his employment is terminated: [PROVIDED that where the employment of any person in an establishment is terminated due to the closure of the establishment for any reason other than a weekly or other recognized holiday, the wages earned by him shall be paid before the expiry of the second day from the day on which his employment is so terminated]

(3) The State Government may, by general or special order, exempt, to such extentand subject to such conditions as may be specified in the order, the person responsible for the payment of wages to persons employed upon any railway (otherwise than in a factory) 15[or to persons employed as daily-rated workers in the Public Works Department of the Central Government or the State Government] from the operation of this section in respect of wages of any such persons or class of such persons: [PROVIDED that in the case of persons employed as daily-rated workers as aforesaid, no such order shall be made except in consultation with the Central Government.]

(4)[Save as otherwise provided in sub-section (2), all payments] of wages shall be made on a working day.

6. Wages to be paid in current coin or currency notes:

All wages shall be paid in current coin or currency notes or in both: [PROVIDED that the employer may, after obtaining the written authorization of the employed person, pay him the wages either by cheque or by crediting the wages in his bank account.]

7. Deductions which may be made from wages:

(1) Notwithstanding the provisions of sub-section (2) of section 47 of the Indian Railways Act, 1890 (9 of 1890), the wages of an employed person shall be paid to him without deductions of any kind except those authorized by or under this Act.

[Explanation I ] : Every payment made by the employed person to the employer or his agent shall, for the purposes of this Act, be deemed to be a deduction from wages. [Explanation II: Any loss of wages resulting from the imposition, for good and sufficient cause, upon a person employed of any of the following penalties, namely:-

(i) the withholding of increment or promotion (including the stoppage of increment at an efficiency bar);(ii) the reduction to a lower post or time scale or to a lower stage in a time scale; or (iii) suspension; shall not be deemed to be a deduction from wages in any case where the rules framed by the employer for the imposition of any such penalty are in conformity with the requirements, if any, which may be specified in this behalf by the State Government by notification in the Official Gazette.]

(2) Deductions from the wages of an employed person shall be made only in accordance with the provisions of this Act, and may be of the following kinds only, namely:

(a) fines;

(b) deductions for absence from duty;

(c) deductions for damage to or loss of goods expressly entrusted to the employed person for custody, or for loss of money for which he is required to account, where such damage or loss is directly attributable to his neglect or default;

(d) deductions for house-accommodation supplied by the employer or by government or any housing board set up under any law for the time being in force(whether the government or the board is the employer or not) or any other authority engaged in the business of subsidizing house- accommodation which may be specified in this behalf by the State Government by notification in the Official Gazette;]

(e) deductions for such amenities and services supplied by the employer as the State Government 15[or any officer specified by it in this behalf] may, by general or special order, authorize.

Explanation: The word "services" in 23[this clause] does not include the supply of tools and raw materials required for the purposes of employment;

(f) deductions for recovery of advances of whatever nature (including advances for travelling allowance or conveyance allowance), and the interest due in respect thereof, or for adjustment of over-payments of wages;

(ff) deductions for recovery of loans made from any fund constituted for the welfare of labour in accordance with the rules approved by the State Government, and the interest due in respect thereof;(fff) deductions for recovery of loans granted for house-building or other purposes approved by the State Government and the interest due in respect thereof;

(g) deductions of income-tax payable by the employed person;

(h) deductions required to be made by order of a court or other authority competent to make such order;

(i) deductions for subscriptions to, and for repayment of advances from any provident fund to which the Provident Funds Act, 1925 (19 of 1925), applies or any recognized provident fund as defined in 24[section 58A of the Indian Income Tax Act, 1922 (11 of 1922)], or any provident fund approved in this behalf by the State Government, during the continuance of such approval; 25[***]

(j) deductions for payments to co-operative societies approved by the State Government [or any officer specified by it in this behalf] or to a scheme of insurance maintained by he Indian Post Office, and

(k) deductions, made with the written authorization of the person employed for payment of any premium on his life insurance policy to the Life Insurance Corporation Act of India established under the Life Insurance Corporation Act, 1956 (31 of 1956), or for the purchase of securities of the Government of India or of any State Government or for being deposited in any Post Office Savings Bank in furtherance of any savings scheme of any such government.

(kk) deductions, made with the written authorisation of the employed person, for the payment of his contribution to any fund constituted by the employer or a trade union registered under the Trade Union Act, 1926 (16 of 1926), for the welfare of the employed persons or the members of their families, or both, and approved by the State Government or any officer specified by it in this behalf, during the continuance of such approval;

(kkk) deductions, made with the written authorisation of the employed person, for payment of the fees payable by him for the membership of any trade union registered under the Trade Union Act, 1926 (16 of 1926);

(l) deductions, for payment of insurance premia on Fidelity Guarantee Bonds;

(m) deductions for recovery of losses sustained by a railway administration on account of acceptance by the employed person of counterfeit or base coins or mutilated or forged currency notes;

(n) deductions for recovery of losses sustained by a railway administration on account of the failure of the employed person to invoice, to bill, to collect or to account for the appropriate charges due to that administration whether in respect of fares, freight, demurrage, wharfage and cranage or in respect of sale of food in catering establishments or in respect of sale of commodities in grain shops or otherwise;

(o) deductions for recovery of losses sustained by a railway administration on account of any rebates or refunds incorrectly granted by the employed person where such loss is directly attributable to his neglect or default;

(p) deductions, made with the written authorisation of the employed person, for contribution to the Prime Minister’s National Relief Fund or to such other Fund as theCentral Government may, by notification in the Official Gazette, specify;

(q) deductions for contributions to any insurance scheme framed by the Central Government for the benefit of its employees. (3) Notwithstanding anything contained in this Act, the total amount of deductions which may be made under sub-section (2) in any wage-period from the wages of any employed person shall not exceed

(i) in cases where such deductions are wholly or partly made for payments to cooperative societies under clause (j) of sub-section (2), seventy-five per cent of such wages, and

(ii) in any other case, fifty per cent of such wages: PROVIDED that where the total deductions authorised under sub-section (2) exceed seventy five per cent or, as the case may be, fifty per cent of the wages, the excess may be recovered in such manner as may be prescribed.

(4) Nothing contained in this section shall be construed as precluding the employer from recovering from the wages of the employed person or otherwise any amount payable By such person under any law for the time being in force other than the Indian Railways Act, 1890 (9 of 1890).

8. Fines:

(1) No fine shall be imposed on any employed person save in respect of such acts and omissions on his part as the employer, with the previous approval of the State Government or of the prescribed authority, may have specified by notice under subsection (2).(2) A notice specifying such acts and omissions shall be exhibited in the prescribed manner on the premises in which the employment is carried on or in the case of persons employed upon a railway (otherwise than in a factory), at the prescribed place or places.

(3) No fine shall be imposed on any employed person until he has been given an opportunity of showing cause against the fine, or otherwise than in accordance with such procedure as may be prescribed for the imposition of fines.

(4) The total amount of fine which may be imposed in any one wage-period on any employed person shall not exceed an amount equal to 29[three per cent] of the wages payable to him in respect of that wage-period.

(5) No fine shall be imposed on any employed person who is under the age of fifteen years.

(6) No fine imposed on any employed person shall be recovered from him by instalments or after the expiry of sixty days from the day on which it was imposed.

(7) Every fine shall be deemed to have been imposed on the day of the act or omission in respect of which it was imposed.

(8) All fines and all realisations thereof shall be recorded in a register to be kept by the person responsible for the payment of wages under section 3 in such form as may be prescribed; and all such realisations shall be applied only to such purposes beneficial to the persons employed in the factory or establishment as are approved by the prescribed authority.

Explanation: When the persons employed upon or in any railway, factory or [industrial or other establishment] are part only of a staff employed under the same management, all such realisations may be credited to a common fund maintained for the staff as a whole, provided that the fund shall be applied only to such purposes as are approved by the prescribed authority.

9. Deductions for absence from duty:

(1) Deductions may be made under clause (b) of sub-section (2) of section 7 only on account of the absence of an employed person from the place or places where, by the terms of his employment, he is required to work, such absence being for the whole or any part of the period during which he is so required to work.

(2) The amount of such deduction shall in no case bear to the wages payable to the employed person in respect of the wage-period for which the deduction is made in a larger proportion than the period for which he was absent bears to the total period, within such wage-period, during which by the terms of his employment, he wasrequired to work: PROVIDED that, subject to any rules made in this behalf by the State Government, if ten or more employed persons acting in concert absent themselves without due notice (that is to say without giving the notice which is required under the terms of their contracts of employment) and without reasonable cause, such deduction from any such person may include such amount not exceeding his wages for eight days as may by any such terms be due to the employer in lieu of due notice.

Explanation: For the purposes of this section, an employed person shall be deemed to be absent from the place where he is required to work if, although present in such place, he refuses, in pursuance of a stay-in strike or for any other cause which is not reasonable in the circumstances, to carry out his work.

10. Deductions for damage or loss:

(1) A deduction under clause (c) or clause (o) of sub-section (2) of section 7 shall not exceed the amount of the damage or loss caused to the employer by the neglect or default of the employed person. (1A) A deduction shall not be made under clause (c) or clause (m) or clause (n) or clause (o) of sub-section (2) of section 7 until the employed person has been given an opportunity of showing cause against the deduction or otherwise than in accordance with such procedure as may be prescribed for the making of such deduction.

(3) All such deduction and all realisations thereof shall be recorded in a register to be kept by the person responsible for the payment of wages under section 3 in such form as may be prescribed.

11. Deductions for services rendered:A deduction under clause (d) or clause (e) of sub-section (2) of section 7 shall not be made from the wages of an employed person, unless the house-accommodation amenity or service has been accepted by him, as a term of employment or otherwise, and such deduction shall not exceed an amount equivalent to the value of the house-accommodation amenity or service supplied and, in the case of deduction under the said clause (e), shall be subject to such conditions as 22[***] the State Government may impose.

12. Deductions for recovery of advances:

Deductions under clause (f) of sub-section (2) of section 7 shall be subject to the following conditions, namely:

(a) recovery of an advance of money given before employment began shall be made from the first payment of wages in respect of a complete wage-period, but no recovery shall be made of such advances given for travelling-expenses;

(aa) recovery of an advance of money given after employment began shall be subject to such conditions as the State Government may impose;

(b) recovery of advances of wages not already earned shall be subject to any rules made by the State Government regulating the extent to which such advances may be given and the instalments by which they may be recovered.

12A. Deductions for recovery of loans

Deductions for recovery of loans granted under clause (fff) of sub-section (2) of section 7 shall be subject to any rules made by the State Government regulating the extent to which such loans may be granted and the rate of interest payable thereon.

13. Deductions for payments to co-operative societies and insurance Schemes;

Deductions under clause (j) 27[and clause (k)] of sub-section (2) of section 7 shall be subject to such conditions as the State Government may impose.

13A. Maintenance of registers and records

(1) Every employer shall maintain such registers and records giving such particulars of persons employed by him, the work performed by them, the wages paid to them, the deductions made from their wages, the receipts given by them and such other particulars and in such form as may be prescribed.(2) Every register and record required to be maintained under this section shall, for the purposes of this Act, be preserved for a period of three years after the date of the last entry made therein.

14. Inspectors:

(1) An Inspector of Factories appointed under 31[sub-section (1) of section 8 of the Factories Act, 1948 (63 of 1948)], shall be an Inspector for the purposes of this Act in respect of all factories within the local limits assigned to him.

(2) The State Government may appoint Inspectors for the purposes of this Act in respect of all persons employed upon a railway (otherwise than in a factory) to whom this Act applies.

(3) The State Government may, by notification in the Official Gazette, appoint such other persons as it thinks fit to be Inspectors for the purposes of this Act, and may define the local limits within which and the class of factories and [industrial or other establishments] in respect of which they shall exercise their functions.

(4) An Inspector may,

(a) make such examination and inquiry as he thinks fit in order to ascertain whether the provisions of this Act or rules made there under are being observed;(b) with such assistance, if any, as he thinks fit, enter, inspect and search any premises of any railway, factory or 12[industrial or other establishment] at any reasonable time for the purpose of carrying out the objects of this Act;

(c) supervise the payment of wages to persons employed upon any railway or in any factory or [industrial or other establishment];(d) require by a written order the production at such place, as may be prescribed, of any register maintained in pursuance of this Act and take on the spot or otherwise statements of any persons which he may consider necessary for carrying out the purposes of this Act;(e) seize or take copies of such registers or documents or portions thereof as he may consider relevant in respect of an offence under this Act which he has reason to believe has been committed by an employer;(f) exercise such other powers as may be prescribed: PROVIDED that no person shall be compelled under this sub-section to answer any question or make any statement tending to incriminate himself. (4A) The provisions of the [Code of Criminal Procedure, 1973 (2 of l974)] shall, so far as may be, apply to any search or seizure under this sub-section as they apply to any search or seizure made under the authority of a warrant issued under [section 94] of the said Code].(5) Every Inspector shall be deemed to be a public servant within the meaning of the Indian Penal Code, 1860 (45 of 1860).

14A. Facilities to be afforded to Inspectors

Every employer shall afford an Inspector all reasonable facilities for making any entry, inspection, supervision, examination or inquiry under this Act.

15. Claims arising out of deductions from wages or delay in payment of wages and penalty for malicious or vexatious claims:

(1) The State Government may, by notification in the Official Gazette, appoint [a presiding officer of any Labour Court or Industrial Tribunal, constituted under the Industrial Disputes Act, 1947 (14 of 1947), or under any corresponding law relating to the investigation and settlement of industrial disputes in force in the State or] any Commissioner for Workmen’s Compensation or other officer with experience as a Judge of a Civil Court or as a Stipendiary Magistrate to be the authority to hear and decide for any specified area all claims arising out of deductions from the wages, or delay in payment of the wages, [of persons employed or paid in that area, including all matters, incidental to such claims: PROVIDED that where the State Government considers it necessary so to do, it may appoint more than one authority for any specified area and may, by general or special order, provide for the distribution or allocation of work to be performed by them under this Act.]

(2) Where contrary to the provisions of this Act any deduction has been made from the wages of an employed person, or any payment of wages has been delayed, such person himself, or any legal practitioner or any official of a registered trade union authorised in writing to act on his behalf, or any Inspector under this Act, or any other person acting with the permission of the authority appointed under sub-section (1), may apply to such authority for a direction under sub-section (3): PROVIDED that every such application shall be presented within 35[twelve months] from the date on which the deduction from the wages was made or from the date on which the payment of the wages was due to be made, as the case may be: PROVIDED FURTHER that any application may be admitted after the said period [twelve months] when the applicant satisfies the authority that he had sufficient cause for not making the application within such period.

(4) When any application under sub-section (2) is entertained, the authority shall hear the applicant and the employer or other person responsible for the payment of wages under section 3, or give them an opportunity of being heard, and, after such further inquiry (if any) as may be necessary, may, without prejudice to any other penalty to which such employer or other person is liable under this Act, direct the refund to the employed person of the amount deducted, or the payment of the delayed wages, together with the payment of such compensation as the authority may think fit, not exceeding ten times the amount deducted in the former case and [not exceeding twenty-five rupees in the latter, and even if the amount deducted or the delayed wages are paid before the disposal of the application, direct the payment of such compensation, as the authority may think fit, not exceeding twenty-five rupees]:

PROVIDED that no direction for the payment of compensation shall be made in the case of delayed wages if the authority is satisfied that the delay was due to-

(a) a bona fide error or bona fide dispute as to the amount payable to the employed person, or(b) the occurrence of an emergency, or the existence of exceptional circumstances, such that the person responsible for the payment of the wages was unable, though exercising reasonable diligence, to make prompt payment, or(c) the failure of the employed person to apply for or accept payment. [(4) If the authority hearing an application under this section is satisfied-(d) that the application was either malicious or vexatious, the authority may direct that a penalty not exceeding fifty rupees be paid to the employer or other person responsible for the payment of wages by the person presenting the application; or

(e) that in any case in which compensation is directed to be paid under sub-section

(4), the applicant ought not to have been compelled to seek redress under this section, the authority may direct that a penalty not exceeding fifty rupees be paid to the State Government by the employer or other person responsible for the payment of wages.

(4A) where there is any dispute as to the person or persons being the legal representative or representatives of the employer or of the employed person, the decision of the authority on such dispute shall be final.(4B) any inquiry under this section shall be deemed to be a judicial proceeding within the meaning of sections 193, 219 and 228 of the Indian Penal Code (45 of 1860)

(5) Any amount directed to be paid under this section may be recovered-

(a) if the authority is a Magistrate, by the authority as if it were a fine imposed by him as Magistrate, and(b) if the authority is not a Magistrate, by any Magistrate to whom the authority makes application in this behalf, as if it were a fine imposed by such Magistrate.

16. Single application in respect of claims from unpaid group

(1) Employed persons are said to belong to the same unpaid group if they are borne on the same establishment and if 15[deductions have been made from their wages in contravention of this Act for the same cause and during the same wage-period or periods or if] their wages for the same wage-period or periods have remained unpaid after the day fixed by section 5.

(2) A single application may be presented under section l5 on behalf or in respect of any number of employed persons belonging to the same unpaid group, and in such case 11[every person on whose behalf such application is presented may be awarded maximum compensation to the extent specified in sub-section (3) of section 15].

(5) The authority may deal with any number of separate pending applications, presented under section 15 in respect of persons belonging to the same unpaid group, as a single application presented under sub-section (2) of this section, and the provisions of that sub-section shall apply accordingly.

17. Appeal:

1) An appeal against an order dismissing either wholly or in part an application made under sub-section (2) of section 15, or against a direction made under subsection (3) or sub-section (4) of that section] may be preferred, within thirty days of the date on which [the order or direction] was made, in a Presidency-town 39[***] before the Court of Small Causes and elsewhere before the District Court

(a) by the employer or other person responsible for the payment of wages under section 3, if the total sum directed to be paid by way of wages and compensation exceeds three hundred rupees 15[or such direction has the effect of imposing on the employer or the other person a financial liability exceeding one thousand rupees], or

[(b) by an employed person or any legal practitioner or any official of a registered trade union authorised in writing to act on his behalf or any Inspector under this Act, or any other person permitted by the authority to make an application under subsection (2) of section 15, if the total amount of wages claimed to have been withheld from the employed person exceeds twenty rupees or from the unpaid group to which the employed person belongs or belonged exceeds fifty rupees, or]

(c) by any person directed to pay a penalty under sub-section (4) of section 15. 15[(1A) No appeal under clause (a) of sub-section (1) shall lie unless the memorandum of appeal is accompanied by a certificate by the authority to the effect that the appellant has deposited the amount payable under the direction appealed against.]

2) Save as provided in sub-section (1) any order dismissing either wholly or in part an application made under sub-section (2) of section 15, or a direction made under sub-section (3) or sub-section (4) of that section shall be final.

3) Where an employer prefers an appeal under this section the authority against whose decision the appeal has been preferred may, and if so directed by the court referred to in sub-section (1) shall, pending the decision of the appeal, withhold payment of any sum in deposit with it.

4) The court referred to in sub-section (1) may if it thinks fit submit any question of law for the decision of the High Court and, if it so does, shall decide the question in conformity with such decision.

17A. Conditional attachment of property of employer or other person responsible for payment of wages;

(1) Where at any time after an application has been made under sub-section (2) of section 15 the authority, or where at any time after an appeal has been filed under section 17 by an employed person or 11[any legal practitioner or any official of a registered trade union authorised in writing to act on his behalf or any Inspector under this Act or any other person permitted by the authority to make an application under sub-section (2) of section 15] the Court referred to in that section, is satisfied that the employer or other person responsible for the payment of wages under section 3 is likely to evade payment of any amount that may be directed to be paid under section 15 or section 17, the authority or the court, as the case may be, except in cases where the authority or court is of the opinion that the ends of justice would be defeated by the delay, after giving the employer or other person an opportunity of being heard, may direct the attachment of so much of the property of the employer or other person responsible for the payment of wages as is, in the opinion of the authority or court, sufficient to satisfy the amount which may be payable under the direction.

(2) The provisions of the Code of Civil Procedure, 1908 (5 of 1908), relating to attachment before judgment under that Code shall, so far as may be, apply to any order for attachment under sub-section (1).

18. Powers of authorities appointed under section 15:

Every authority appointed under sub-section (1) of section 15 shall have all the powers of a civil court under the Code of Civil Procedure, 1908 (5 of 1908), for the purpose of taking evidence and of enforcing the attendance of witnesses and compelling the production of documents, and every such authority shall be deemed to be a civil court for all the purposes of section 195 and of [Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974).]

19. Power to recover from employer in certain cases [Repealed by the Payment of Wages (Amendment) Act, 1964 (53 of 1964), w.e.f. 1st. February, 1965]

20. Penalty for offences under the Act:

(1) Whoever being responsible for the payment of wages to an employed person contravenes any of the provisions of any of the following sections, namely, [section 5 except sub-section (4) thereof, section 7, section 8 except sub-section (8) thereof, section 9, section 10 except sub-section (2) thereof, and section 11 to 13], both inclusive, shall be punishable with fine 42[which shall not be less than two hundred rupees but which may extend to one thousand rupees.]

(2) Whoever contravenes the provisions of section 4, 43[sub-section (4) of section 5, section 6, sub-section (8) of section 8, sub-section (2) of section 10] or section 25 shall be punishable with fine which may extend to 44[five hundred rupees.]

[(3) Whoever being required under this Act to maintain any records or registers or to furnish any information or return-(a) fails to maintain such register or record; or(b) wilfully refuses or without lawful excuse neglects to furnish such information or return; or(c) wilfully furnishes or causes to be furnished any information or return which he knows to be false; or(d) refuses to answer or wilfully gives a false answer to any question necessary for obtaining any information required to be furnished under this Act, shall, for each such offence, be punishable with fine 45[which shall not be less than two hundred rupees but which may extend to one thousand rupees].

(4) Whoever-(a) wilfully obstructs an Inspector in the discharge of his duties under this Act; or(b) refuses or wilfully neglects to afford an Inspector any reasonable facility for making any entry, inspection, examination, supervision, or inquiry authorised by or under this Act in relation to any railway, factory or 12[industrial or other establishment]; or(c) wilfully refuses to produce on the demand of an Inspector any register or other document kept in pursuance of this Act; or(d) prevents or attempts to prevent or does anything which he has any reason to believe is likely to prevent any person from appearing before or being examined by an Inspector acting in pursuance of his duties under this Act; shall be punishable with fine 45[which shall not be less than two hundred rupees but which may extend to one thousand rupees.]

(5) If any person who has been convicted of any offence punishable under this Act is again guilty of an offence involving contravention of the same provision, he shall be punishable on a subsequent conviction with imprisonment for a term 46[which shall not be less than one month but which may extend to six months and with fine which shall not be less than five hundred rupees but which may extend to three thousand rupees]: PROVIDED that for the purpose of this sub-section no cognizance shall be taken of any conviction made more than two years before the date on which the commission of the offence which is being punished came to the knowledge of the Inspector.

(6) If any person fails or willfully neglects to pay the wages of any employed person by the date fixed by the authority in this behalf, he shall, without prejudice to any other action that may be taken against him, be punishable with an additional fine which may extend to [one hundred rupees] for each day for which such failure or neglect continues.]

21. Procedure in trial of offences:

(1) No court shall take cognizance of a complaint against any person for an offence under sub-section (1) of section 20 unless an application in respect of the facts constituting the offence has been presented under section 15 and has been granted wholly or in part and the authority empowered under the latter section or the appellate Court granting such application has sanctioned the making of the complaint.

(2) Before sanctioning the making of a complaint against any person for an offence under sub-section (1) of section 20, the authority empowered under section 15 or the appellate Court, as the case may be, shall give such person an opportunity of showing cause against the granting of such sanction, and the sanction shall not be granted if such person satisfies the authority or Court that his default was due to-

(a) a bona fide error or bona fide dispute as to the amount payable to the employed person, or(b) the occurrence of an emergency or the existence of exceptional circumstances, such that the person responsible for the payment of the wages was unable, though exercising reasonable diligence, to make prompt payment, or(c) the failure of the employed person to apply for or accept payment.

(3) No Court shall take cognizance of a contravention of section 4 or of section 6 or of a contravention of any rule made under section 26 except on a complaint made by or with the sanction of an Inspector under this Act. [(3A) No Court shall take cognizance of any offence punishable under sub-section (3) or sub-section (4) of section 20 except on a complaint made by or with the sanction of an Inspector under this Act.]

(4) In imposing any fine for an offence under sub-section (1) of section 20 the court shall take into consideration the amount of any compensation already awarded against the accused in any proceedings taken under section 15.

22. Bar of suits:

No Court shall entertain any suit for the recovery of wages or of any deduction from wages in so far as the sum so claimed-

(a) forms the subject of an application under section 15 which has been presented by the plaintiff and which is pending before the authority appointed under that section or of an appeal under section 17; or(b) has formed the subject of a direction under section 15 in favour of the plaintiff; or(c) has been adjudged, in any proceeding under section 15, not to be owed to the plaintiff; (d) could have been recovered by an application under section 15.

[22A. Protection of action taken in good faithNo suit, prosecution or other legal proceeding shall lie against the government or any officer of the government for anything which is in good faith done or intended to be done under this Act.]

23. Contracting out:Any contract or agreement, whether made before or after the commencement of this Act, whereby an employed person relinquishes any right conferred by this Act shall be null and void in so far as it purports to deprive him of such right.

[24. Application of Act to railways, air transport services, mines and oilfields: The powers by this act conferred upon the State Government shall, in relation to [railways], 15[air transport services,] mines and oilfields, be powers of the Central Government.]

25. Display by notice of abstracts of the Act:The person responsible for the payment of wages to persons; [employed in a factory or an industrial or other establishment] shall cause to be 51[displayed in such factory or industrial or other establishment] a notice containing such abstracts of this Act and of the rules made there under in English and in the language of the majority of the persons employed 52[in the factory, or industrial or other establishment], as may be prescribed.

[25A. Payment of undisbursed wages in case of death of employed person

(1) Subject to the other provisions of the Act all amounts payable to an employed person as wages shall, if such amounts could not or cannot be paid on account of his death before payment or on account of his whereabouts not being known,-

(a) be paid to the person nominated by him in this behalf in accordance with the rules made under this Act; or(b) where no such nomination has been made or where for any reasons such amounts cannot be paid to the person so nominated, be deposited with the prescribed authority who shall deal with the amounts so deposited in such manner as may be prescribed.

(2) Where, in accordance with the provisions of sub-section (1), all amounts payable to an employed person as wages-

(a) are paid by the employer to the person nominated by the employed person; or (b) are deposited by the employer with the prescribed authority, the employer shall be discharged of his liability to pay those wages.]

26. Rule-making power

(1) The State Government may make rules to regulate the procedure to be followed by the authorities and courts referred to in sections 15 and 17.

(2) The State Government may, 89[***] by notification in the Official Gazette, make rules for the purpose of carrying into effect the provisions of this Act.

(3) In particular and without prejudice to the generality of the foregoing power, rules made under sub-section (2) may

(a) require the maintenance of such records, registers, returns and notices as are necessary for the enforcement of the Act 54[prescribe the form thereof and the particulars to be entered in such registers or records];

(b) require the display in a conspicuous place on premises where employment is carried on of notices specifying rates of wages payable to persons employed on such premises;

(c) Provide for the regular inspection of the weights, measures and weighing machines used by employers in checking or ascertaining the wages of persons employed by them;

(d) prescribe the manner of giving notice of the days on which wages will be paid;

(e) prescribe the authority competent to approve under sub-section (1) of section 8 acts and omissions in respect of which fines may be imposed;

(f) prescribe the procedure for the imposition of fines under section 8 and for the making of the deductions referred to in section 10;

(g) prescribe the conditions subject to which deductions may be made under the proviso to sub-section (2) of section 9;

(h) prescribe the authority competent to approve the purposes on which the proceeds of fines shall be expended;

(i) prescribe the extent to which advances may be made and the installments by which they may be recovered with reference to clause (b) of section 12;

[(a) prescribe the extent to which loans may be granted and the rate of interest payable thereon with reference to section 12A,.(b) prescribe the powers of Inspectors for the purposes of this Act;]

(j) regulate the scale of costs which may allowed in proceedings under this Act;

(k) prescribe the amount of court-fees payable in respect of any proceedings under this Act, 55[***]

(l) prescribe the abstracts to be contained in the notices required by section 25; [***]

(a) prescribe the form and manner in which nominations may be made for the purposes of sub-section (1) of section 25A, the cancellation or variation of any such nomination, or the making of any fresh nomination in the event of the nominee predeceasing the person making nomination, and other matters connected with such nominations;

(b) specify the authority with whom amounts required to be deposited under clause (b) of sub-section (1) of section 25A shall be deposited, and the manner in which such authority shall deal with the amounts deposited with it under that clause;]

[(m) provide for any other matter which is to be or may be prescribed.]

(4) In making any rule under this section the State Government may provide that a contravention of the rule shall be punishable with fine which may extend to two hundred rupees.

(5) All rules made under this section shall be subject to the condition of previous publication, and the date to be specified under clause (3) of section 23 of the General Clauses Act, 1897 (10 of 1897), shall not be less than three months from the date on which the draft of the proposed rules was published.

(6) Every rule made by the Central Government under this section shall be laid, as soon as may be after it is made, before each House of Parliament while it is in session for a total period of thirty days which may be comprised in one session or in [two or more successive sessions,] and if, before the expiry of the session [immediately following the session or the successive sessions aforesaid,] both Houses agree in making any modification in the rule, or both Houses agree that the rule should not be made, the rule shall thereafter have effect only in such modified form or be of no effect, as the case may be; so however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule.

COMPONENTS OF WAGES

In

today’s cut throat competitive and turbulent environment employee retention is becoming

increasingly significant. Employee attrition costs organizations dearly since, high attrition rate

not only affects succession planning and employee morale, but also customer satisfaction and

sales. Employment of fresh candidates is also costly

Attrition is a symptom not a problem. It is the manifestation of deeper issues that have not been

resolved. This could be due to low morale, no career path, lack of recognition, poor employee

manager relationship etc. The co-workers feels insecure, and negativity in the environment takes

root when the management fails to retain its key employees.

Employees’ attrition is an universal phenomenon and oil industry is no exception. According to a

recent Oil & Gas UK online poll, the biggest threat to producing 3million BOE (barrels of oil

equivalent) by 2010 will be a lack of human resources. The economic situation regarding oil

price is such that companies are concentrating most of their efforts at producing as much oil as

possible without thinking much of the long term manpower situation. Human capital is right now

the most important and also the most scare resource for the oil industry. This situation causes

tremendous strategic difficulties for most companies, but it can create opportunities for others. If

oil companies can create a real strength in attracting and retaining the best workers in the oil

industry, we will have a competitive advantage that few can match. What we need is to highlight

our strengths in the job pool and initiate retention measures which are affordable and aligned

with our strategy.

COMPONENTS OF WAGES

1. BASIC SALARY:

Pay scale of executives has being revised based on instruction of Govt. of India, Department of

Public Enterprise as on 1.1.07.

As per the guidelines the pay scales of the executives are revised as per table below:

Level Pre Revised Revised

E-0 10750-16750 20600-46500

E-1 12000-17500 24900-50500

E-2 13750-18700 29100-54500

E-3 16000-20800 32900-58000

E-4 17500-22300 36600-62000

E-5 18500-23900 43200-66000

E-6 19500-25600 51300-71000

E-7/E-8 20500-26500 51300-73000

E-9 23750-28550 62000-80000

Annual Rate of increment: 3% of Basic Pay paid on the 1st of January every year

* Charge Allowance of Rs. 400/- p.m at E-8 level

It is pertinent to mention that the pay scales for non executives are due for revision and till then

the employees of non executive category are paid salaries at pre revised pay scales.

2. ALLOWANCE: As per the guidelines of Department. Of Public Enterprise, the allowances

and perks are to be revised w.e.f. 26.11.2008. In ONGC, however, the allowances have not been

revised so far, except the following allowances:

i. Dearness Allowance

ii. House Rent Allowance

iii. Non Practicing Allowance (for doctors)

iv. North East Allowance

Till the time the allowances are revised, whatever allowances the executives were drawing before the revision of pay scales are frozen and being paid to the executives.

The allowances of ONGC can be divided as allowances for office going employees and allowances for field going personnel. The various allowances paid to the office going personnel are as follows:

Dearness Allowance (DA) House Rent Allowance (HRA) NE Allowance Professional Pursuit Allowance Non Practicing Allowance (for doctors)

The various field based allowances are as follows:

Drill Site Compensatory Allowance (DSCA)

Category Rate for office going personnel Rate for field going personnel

N.E & Sand Dune Areas 27.5%, max.4000 27.5%, max.4600

Normal Areas other than above: 20%, max. 3600 20%, max. 4200

Offshore Hard Duty Allowance (OHDA)

Payable to employees working in Offshore Installations/Rigs/Vessels at 33% of running basic pay after applying a factor of 1.35 on Basic Pay+DP

Shift Allowance

Description 8 hours shift duty (Rs. Per shift) 12 hours shift duty (Rs. Per shift)

General Shift 25 35

Morning/Eve/Day 50 75

Night Shift85 125

Operational Allowance

Category Rate of Operational Allowance

General Shift 7.5% of Basic Pay after applying the factor of 1.35 on the running Basic Pay+DP

2/3 Shift 10% of Basic Pay after applying the factor of 1.35 on the running Basic Pay+DP

14 days On/Off 12 hours duty on 2 days On/Off pattern

in 2 shifts

12.5% of Basic Pay after applying the factor of 1.35 on the running Basic Pay+DP

Professional Pursuit Allowance: Payable at the rate of 2% of Basic Pay+DP after applying the factor of 1.35 on the running Basic Pay+DP. Maximum ceiling of Rs. 600/-

Non Practicing Allowance(for doctors)These allowances are revised w.e.f. 26.11.2008

3. BENEFITS AND FACILITIES:

MEDICAL FACILITY

Eligibility: All employees and their dependent family members

Dependents:

• Spouse, children and parents who are wholly dependent on and residing with the

employee concerned for at least six months in a calendar year (prior to 11/9/1987)

• Spouse, two children and parents who are wholly dependent on and residing with the

employee concerned for at least six months in a calendar year (after 11/9/1987)

• Issue of medicines

Medical Officers of ONGC are authorized to issue medicines prescribed by

Authorized Medical Attendants of ONGC and Government whenever any patient

is referred for outside treatment

Employees are issued medicines for a period which will be decided by the ONGC

Authorized Medical Officer; as he is the best judge in prescribing the medicine

and duration

No medicines will be issued against the prescription of Private Medical

Practitioners

• Employees of the Company and their family members referred from outstation for

medical treatment to a hospital (with whom ONGC has credit facilities) located at a

work-centre in any other Region, the hospital and other bills towards medical treatment

shall be admitted on the basis of verification by the In-charge Medical where the patient

has obtained the treatment. If any recovery is advised, the same shall be made from the

employee concerned on the basis of details which would be provided by the

recommending Medical Authority.

• Reimbursement for such authorized treatment can also be made on the certification by

regional P&A In-charge concerned.

• Proper and careful scrutiny and verification of bills be made before releasing payment to

the empanelled hospitals/Nursing Homes .

• Placement of an employee after recovery from a serious illness should be decided by

Controlling Officer and Medical Officer.

ADVANCES

The various advances given by ONGC to its employees are as follows:

HBA CONVEYANCE CHILDREN EDUCATION LOAN COMPUTER ADVANCE

Welfare….Holiday Home

During leave for rest and recreation at any place of choice in India (except home town) or any place/places in a foreign country/countries

• Reimbursement to be as per existing rates only

• Holiday Home abroad may be clubbed while availing LFA for OTHT either alone or with family once in a block of two calendar years for a maximum of 10 days or every year for a maximum of 5 days

Welfare…LFA( Leave Fare Assistance)

Applicability: To all whole time employees who have completed one year of continuous service

• Block year: Group of four consecutive calendar years. Current block year: 2006-2009

Eligibility:

Employees and their family members:

o Self, Spouse, and legitimate unmarried children including parents, unmarried

sister and minor brothers (below 18 years of age), permanently residing with and

wholly dependent upon the employee for those who joined ONGC on or before

1st June, 1987

o Self, Spouse, not exceeding first two unmarried legitimate children and parents

who reside with the employee for at least 8 months in a calendar year children for

those who joined ONGC on or after 2nd June, 1987

4. Variable Pay/Performance Related Pay

In order to make PSUs more efficient and performance oriented, DPE guidelines provide that

Variable Pay Related Pay be made an integral part of the compensation package.

The PRP is linked to the profit of the CPSE and the performance of the executives. The

percentage ceiling of PRP increases from junior level to senior level as the most complex

problems are tackled by top executives

There is a MOU(Memorandum Of Understanding) signed with parent ministry and the MOU

will form the basis of PRP.If a CPSE achieves “Excellent” MOU rating ,the PRP can be paid at

100% level. Similarly if the rating is “very good” the eligibility is 80%.For “good” and “fair”

ratings the criteria is 60% and 40% respectively.

The PRP is based on financial performance and profits of the company.

60% of Performance Pay will be given with a ceiling of 3% of Profit Before Tax.

40% of PRP would come from 10% of incremental profit(the increase in profit as

compared to last year’s profit)

The total PRP would limited to 5% of year’s PBT.

ONGC for better perks to arrest attrition.

ONGC is making efforts to impress upon the Government the need to provide attractive

remuneration packages to employees, as the public sector company is facing problems

of attrition and poaching by the private sector oil companies, according to Dr. A.K

Balyan,

He said there was an urgent to need bridge the gap between the wages paid by the private companies and the PSUs. “We are also on a large recruitment drive and are formulating attractive policies to retain the trained employees,” Dr Balyan said ONGC would recruit 1,500 employees this year and it would continue for the next three to four years.“We are also welcoming back employees who have quit the ONGC in certain critical disciplines. Quite a few employees who have quit ONGC and joined the private companies are disenchanted with the latter and are coming back. We have received 400 such applications and of them we have shortlisted 130 or so. Twenty-six will be taken back immediately.”

WAGES AND SALARY IN ONGC &

MORALE OF THE EMPLOYEE

INTRODUCTION

Employee Morale refers to an attitude of satisfaction with a desire to continue and strive for

attaining the objectives of a factory. Morale is purely emotional. It is an attitude of an employee

towards his job, his superior and his organization. It is not static thing, but it changes depending

on working conditions, superiors, fellow workers pay and so on.

Morale may range from very high to very low. High Morale is evident from the positive feelings

of employees such as enthusiasm, desire to obey orders, willingness to co-operate with

coworkers. Poor or low Morale becomes obvious from the negative feelings of employees such

as dissatisfaction, discouragement or dislike of the job.

Definitions:

Morale is a fundamental psychological concept. It is not easy to define. Morale is the degree of

enthusiasm and willingness with which the members of a group pull together to achieve group

goal. It has been defined differently by different authors. Different definition of Morale can be

classified into three major approaches.

Classical approach

Psychological approach

Social approach

1. Classical approach: According to this approach the satisfaction of basic needs is the symbol

of Morale. According to Robert M. Guion "Morale is defined as the extent to which the

individual perceives that satisfaction stemming from total job satisfaction".

2. Psychological Approach: According to this approach Morale is psychological concept i.e.,

state of mind. According to Jurious Fillipo, “Morale is a mental condition or attitude of

individual and groups which determines their willingness to cooperate".

3. Social Approach: According to some experts Morale is a social phenomenon.

According to Davis "Morale can be defined as the attitudes of individual and groups towards

their work environment and towards voluntary cooperation to the full extent of their ability in the

best interest at the organization".

Importance of Employee Morale:

Employee Morale plays vital role in the origination success. High Morale leads to success and

low Morale brings to defeat in its wake. The plays of Morale is no less important for an

industrial undertaking. The success of failure of the industry much depends up on the Morale of

its employees.

Types of Morale:

I. High

Morale:

It will lead to enthusiasm among the workers for better performance. High Morale is needed a

manifestation of the employees strength, dependability pride, confidence and devotion. Some of

the advantages of high Morale such as:

1. Willing cooperation towards objectives of the organization.

2. Loyalty to the organization and its leadership.

3. Good Leadership.

4. Sound superior subordinate relations.

5. High degree of employee’s interest in their job and organization.

6. Pride in the organization

7. Reduction in absenteeism and labour turnover.

8. Reduction in grievance.

9. Reduction in industrial conflict.

10. Team building.

11. Employee empowerment.

II. Low Morale:

Low Morale indicates the presence of mental unrest. The mental unrest not only hampers

production but also leads to ill health of the employees. Low Morale exists when doubt in

suspicion are common and when individuals are depressed and discouraged i.e., there is a lot of

mental tension. Such situation will have the following adverse consequences.

1. High rates of absenteeism and labour turnover.

2. Decreased quality.

3. Decreased Productivity.

4. Excessive Complaints and Grievances.

5. Frustration among the workers.

6. Lack of discipline.

7. Increase errors, accidents or injuries.

FACTORS AFFECTING MORALE:

Employee Morale is a very complex phenomenon and is influenced by many factors on the shop

floor. Several criteria seem important in the determinants of levels of workers Morale such as:

1. Objectives of the organization: Employees are highly motivated and their Morale is highly if

their individual goal and objectives are in tune with organizational goal and objectives.

2. Organizational design: Organization structure has an impact on the quality of labour relation,

particularly on the level of Morale. Large organization tend to lengthen their channels of vertical

communication and to increase the difficulty of upward communication. Therefore the Morale

tends to be lower. Against this flat structure increases levels of Morale.

3. Personal Factors: It is relating to age, training, education and intelligence of the employees,

time spent by them on the job and interest in worth taken by them, affect the Morale of the

employees. For examples if employees are not imparted proper training he will have low Morale.

4. Rewards: Employees expect adequate compensation for their services rendered to the

organization. Good system of wages, salaries, promotions and other incentives keep the Morale

of the employees high.

5. Good Leadership and Supervision: The nature of supervision can tell the attitudes of

employees because a supervisor is in direct contact with the employers and can have better

influences on the activities of the employees.

6. Work Environment: The building and it appearance the condition of machines, tools, available

at work place provision for safety, medical aid and repairs to machinery etc. all have an impact

on their Morale.

7. Compatibility with fellow employees: Man being a social animal finds his words more

satisfying if he feels that he has the acceptance and companionship of his fellow workers. If he

has confidence in his fellow worker and faith in their loyalty his Morale will be high.

8. Job Satisfaction: If the job gives an employee an opportunity to prove his talents and grow

personality, he will certify like it and he will have high morale.

9. Opportunity to share profit: one of the requirements of high morale is possibility and

opportunity of progress in any concern. All worker should be given an opportunity of the

progress and earn high wages without any discrimination.

MEASUREMENT OF

MORALE

Morale is basically a psychological concept. As such the measurement of morale is a very

difficult task to measure it directly. However the following methods are more commonly used to

study employee morale.

1. Observation Method:

Under this method evaluator observes the employees on work and records their behaviour,

altitude, sentiments and feelings, which have developed in them. The changes in the attitude and

behaviour of the employee are the indicators of high and low morale.

2.Attitude Surveys:

In order to overcome the limitation of the above method attitude survey method is being largely

employed in modern days. This method includes conducting surveys through questionnaires and

interviews. This relates what the workers are looking in and what step should be taken to

improve their approach towards work.

3.Company Records and Reports:

The records and reports relating to Labour turnover, rate of absenteeism, the number of goods

rejected, strikes and such other things, which are indicators of the level of morale.

4.Counselling:

Under this method employees are advised to develop better mental health. So that they can

imbed self confidence, understanding and self control. This method is used to find out the causes

of dissatisfaction and then to advice the employees by way of remedial measures.

The above methods of the measurement of the employees present only the tendencies or the

attitude of the employee morale. The statistical measurement of morale is not possible because it

relates to the inner feelings human beings. We can say that morale is increasing or decreasing,

but cannot measured how much it increased or increased.

BUILDING OF HIGH

MORALE

In order to achieve high morale among the employees the following suggestion may be followed.

1.Two-Way Communication:-

There should be a two-way communication between the management and the workers as if

exercises a profound influences on morale. The workers should be kept informed about the

organization polices and programmes through conferences, bulletins and informal discussions

with the workers.

2. Show Concern.

Large or small every business should have names on desks work stations or cubicles to show that

a real person with worth works there not just a machine. Next ask their opinion whenever an

opportunity arises rather than always telling them what to do or the way to do it. This allows

employees to add their own creative thoughts to the work process, which then can lead to more

of a feeling of ownership. Finally ask how they are with out wanting to know deeply personal

data the boss can easily show on interest in the individual walkers.

3. Job Enrichment:-

This involves a greater use of the factors which are intended to motive the worker rather than to

ensure his continuing satisfaction with the job he performs the idea is to reduce employee

discontent by changing or improving a job to ensure that he is better motivated.

4. Modifying the work environment:-

This involves the use of teams of work groups developing social contacts of the employees the

use of music regular rest breaks.

5. Rotation of Jobs:

This is also one of important techniques to increase employee morale. Job rotation helps to

reduce an employee's boredom.

6. Incentive System:

There should be a proper incentive system in the organization to ensure monetary and non-

monetary rewards of the employees to motivate them.

7. Welfare Measures:

Management must provide for employees welfare measures like canteens credit facilities sport

clubs, education for their children e.t.c…

8. Social Activities:

Management should encourage social group activities by the workers. This will help to develop

greater group cohesiveness which can be used by the management for building high morale.

9. Training:

There should be proper training of the employees so that they may do their work efficiently and

avoid frustration when the worker are given training they get psychological satisfaction as they

feel that management is taking interest in them.

10. Workers Participation:

There should be industrial democracy in the organization management should allow workers

participation in management. Whenever a change to be introduced which effects the workers

they must be consulted and taken into confidence workers must be allowed to put forward their

suggestion and grievance to the top management.

11. Offers recognition of the employee efforts:

It takes but a few seconds to say "Nice Job" "Well done", "Marked improvement", "You 're' on

the right road" or any number of other phrases that communicate to the employee that you care

about the job and about them and that you recognize an improvement in productivity. Also,

employees can be given performance awards or have their name mentioned at staff meetings,

posted on a notice boards or in employee inter office E-mail to say that someone did a note

monthly Job.

RESEARCH

METHODOLOGY

RESEARCH METHODOLOGY

Research in common parlance refers to a search for knowledge. One can also define research as

a scientific and systematic search for pertinent information on a specific topic. Research

methodology is a way to the systematic solution of the research problems. It focuses on various

steps adopted in studying the research problem along with the logic behind using them.

RESEARCH PROBLEM

The study was conducted to know what the compensation and benefits policies are being offered

which has not been discovered as yet. 9ii89

PROBLEM FORMULATION

RESEARCH OBJECTIVE:

To know about the satisfaction level of the employees in case of there wage structure.

To know the factor which influences the morale of the employees.

To understand the satisfaction level with the process of calculating incentives.

To know the satisfaction level of the employees in case of the recent pay revision held in

ONGC.

To understand the reaction of the ONGCians to feel about there salary structure.

RESEARSH DESIGN:

Descriptive research was used to find out relevant data in context with the project topic.

SAMPLING METHOD:

SOURCES OF INFORMATION

We have collected both types of data primary and secondary

PRIMARY DATA

The primary data are those data, which are collected afresh and for the first time. And happen to

be original in character & can be collected through a questionnaire and personal interview.

SECONDARY DATA

Secondary data means data that are already available. It has been collected through the manuals,

i.e., they refer the data, which have already been collected and analyzed by someone else.

It has been collected through the manuals,journals & internet.

RESEARCH INSTRUMENT

Questionnaire containing only closed ended questions.

SAMPLINGSampling TypeThe method used for selection of employees was Random Sampling. I have distributed the

questionnaires randomly but in the particular offices & buildings.

Survey was done by administrating 10 point question whereby the respondents were

asked to rate the questions on the scale of 1 to 5 where

1 signifies strongly agree

2 signifies agree

3 signifies neutral

4 signifies disagree

5 signifies disagree

Sample size The study based on data collected from employees of ONGC DEHRADUN here 100

employees were covered.

Sample area: ONGC Ltd., TEL BHAVAN, DEHRADUN

Sample unit: 100

LIMITATIONS OF THE STUDY

Organization being very large an effort was made to do the tasks effectively and efficiently but more detailed study could have done by having large sample size.

Employees delayed in submitting the feedback form so it effected the time in compiling and analyzing data for findings and suggestions.

Many questions were responded as “Neutral” due to the subjectivity of the topic and some information was not revealed due to certain reasons like being confidential in nature.

This cannot be generalized.

It was seen that no of employees were not willing to fill the questionnaires which could have been of much help.

Since the sample size is too small comprising of 100 respondents for a vast organization of 40,000 employees the data may not be true representative of the actual scenario.

Already describe that organization is so large. Hence, elaborate study could not have been done due to limited time period.

DATA ANALYSIS

AND

INTERPRETATION

1. Do you think Medical facilities of ONGC one of the main factors to keep the employee secured?

54

28

16 2

strongly agreeagreeto some extentdisagreestrongly disagree

INTERPRETATION: The charts shows that 82% employees agree that medical facilities of ONGC is one of the factors to keep the employee secured whereas 16% have mixed opinion and 2% strongly disagree.

2. Present wage structure provides you a decent status in the company and society as well.

28

52

164

strongly agreeagreeto some extentdisagreestrongly disagree

INTERPRETATION: The chart shows that 80% of the employees agreed that present wage structure provide decent status in the company and society as well whereas, 4% disagree and 16% have mixed opinion.

3. Are you satisfied with the recent pay revision held in ONGC?

6

48

28

10 8

highly satisfiedsatisfiedto some extentleast satisfiednot satisfied

INTERPRETATION: The above pie chart shows 54% employees are satisfied with the recent pay revision held in ONGC whereas 28% people have mixed opinion and 18% strongly disagree.

4. Do you think the wage difference should be higher with respects to the levels?

24

44

22

6 4

strongly agreeagreeto some extentdisagreestrongly disagree

INTERPRETATION: This chart shows that 68% employees agreed that the wage difference should be higher with respects to the levels 22% people agree to some extent and 10% people strongly disagree with the same.

5. Benefits and welfare measurement provided by the company keeps you committed towards the organizational goals?

22

50

18 64

strongly agreeagreeto some extentdisagreestrongly disagree

INTERPRETATION: we can clearly observe from the chart that 72% employees agree that benefits and welfare measurement provided by the company keeps them committed towards the organizational goals whereas 10% people disagree and 18% have mixed opinion.

6. Keeping present wage structure will you motivate your son or daughter to join the company?

26

2622

20 6

strongly agreeagreeto some extentdisagreestrongly disagree

INTERPRETATION: this chart shows that 52% people are agree to motivate their son daughter to join the company whereas 42% have mixed opinion and remaining 6% strongly disagree.

7. Are you agreeing with the process of calculating incentives?

6

40

24

2010

strongly agreeagreeto some extentdisagreestrongly disagree

INTERPRETATION: the chart shows that 46% employee agreeing with the process of calculating incentives whereas 24% employee agree to some extent and remaining 30% strongly disagree.

8. According to you what the people other than ONGCians feel about your salary structure?

21

9

2815

27

jealousself-conscioushappyhonoreddon't bother

INTERPRETATION: by seeing the response received on this question it appears that the salary structure of ONGC employees at par industry

28% of the respondents feel happy about the wage and salary structure, it is assume that respondents may be relatives/friends or known to the employees.

27% feel jealous about the ONGCians, these shows that the perception of the society is that ONGCians are over paid. This may be due to the demonstration affect of the ONGCians and their family members.

Over all the result shows that ONGCians are paid sufficient.

9. How do you find your salary/wages in comparison to:

a. Industries:

6

66

22 6

highly satisfiedsatisfiedto some extentleast satisfiednot satisfied

INTERPRETATION: This chart shows that in comparison to industries 72% of employees are satisfied with their salary/wages whereas 6% are least satisfied and remaining 22% to some extent.

b. Qualification:

14

58

188 2

highly satisfiedsatisfiedto some extentleast satisfiednot satisfied

INTERPRETATION: This chart shows that in comparison to qualification 72% employees finds their salary satisfied whereas 10% are least satisfied and remaining 18% satisfied to some extent.

c. Experience:

12

60

18 8 2

highly satisfiedsatisfiedto some extentleast satisfiednot satisfied

INTERPRETATION: This chart shows that in comparison to experience 72% people finds their salary/wages satisfied whereas 10% are least satisfied and 18% satisfied to some extent.

d. Work load:

18

42

28

8 4

highly satisfiedsatisfiedto some extentleast satisfiednot satisfied

INTERPRETATION: This chart shows that in comparison to work load 60% employee finds their salary/wages satisfied whereas 28% are least satisfied and 12% are not satisfied.

10. What is the major factor that influences the morale of the employees?

40

610

38

6nature of working condi-tionsupervisioninterpersonal relationmanagement policywages and salary

INTERPRETATION: Here the pie chart tells that nature of working condition (40%) and management policy (38%) are the major factor that influences the morale of the employees, whereas 10% thinks its interpersonal relationship and remaining 12% thinks its supervision and wages and salary.

11. What do you think about the Post Retirement Benefit Scheme of ONGC; does it match employee retirement saving contribution?

10

28

40

22

strongly agreeagreeto some extentdisagree

INTERPRETATION: this shows that 40% of employees are satisfied to some extent with the rate of return they get on PRBS schemes.The other group which is either satisfied or dissatisfied may be younger generation group which expects higher rate of return as in equity or share market.

MAJOR FINDINGS OF THE SURVEY

1)54% of the employees are strongly agreed that Medical facilities of ONGC one of the main

factors to keep the employee secured.

2)52% of the employees are agreed that present wage structure provides them a decent status in

the company & society as well.

3)Other hand, 48% of the employees are satisfied with the recent pay revision held in ONGC.

4)Majority 44% of the employees are agreed that wage difference should be higher with respects

to the levels.

5)Benefits and welfare facilities provided by the company keeps employee committed.50% of

the employees are agreed in this case.

6)Majority 26% person have strongly agreed and also 26% person have simply agreed in the

present wage structure which is motivate their son/daughter to join the company.

7)40% of the employees are agree with the process of calculating incentives.

8)Majority 28% employee have feel happy about the salary structure of ONGC.

9)Majority person have satisfied their salary/wages in comparison to INDUSTRIES, QUALIFICATION, EXPERIENCE & WORK LOAD. In comparison to Industries 66%, Qualification 58%, Experience 60% & in case of work load 42% people have satisfied. 10)It is noticed that Nature of the working condition is the major factor that influence the morale of the employees. In this case 40% employees have in favour of Nature of the working condition.

11)Majority 40% employees have thought ‘to some extent’ about the Post Retirement Benefit Scheme (PRBS) of ONGC, it is match employee retirement saving contribution.

RECCOMENDATION

Since the company has no control over the revision of pay scale, in order to be able to

retain skilled people the company should focus more on various benefits and facilities

being provided.

Company have more focus on the employees wage structure, which creats more

attention to their children to join ONGC.

Company have also attention about the salary structure of ONGC through which

employee feel honored, which help to increase the morale of the employees.

Company have also more focus on PRBS of ONGC.

ANNEXURE

Wages and Salary AdministrationAnd morale of the employee

Questionnaire

Personal Details:a) Name:b) Gender:c) Age:d) Experience:e) Qualification:f) Level:g) What’s your basic salary?

i. 10,000-30,000 ( )ii. 30,001-50,000 ( )iii. 50,001-70,000 ( )iv. 70,001-80,000 ( )

1. Do you think Medical facilities of ONGC one of the main factors to keep the employee secured?

Strongly Agree ( ) Agree ( ) To some extent ( )

Disagree ()

Strongly disagree ()

2. Present wage structure provides you a decent status in the company and society as well.

Strongly Agree ( ) Agree ( ) To some extent ( )

Disagree ()

Strongly disagree ()

3. Are you satisfied with the recent pay revision held in ONGC?

Highly satisfied ( )

Satisfied ( )

To some extent ( ) Least satisfied ( ) Not satisfied ( )

4. Do you think the wage difference should be higher with respects to the levels?

Strongly Agree ( ) Agree ( ) To some extent ( )

Disagree ( ) Strongly disagree ( )

5. Benefits and welfare measurement provided by the company keeps you committed towards the organizational goals?

Strongly Agree ( ) Agree ( ) To some extent ( )

Disagree ( ) Strongly disagree ( )

6. Keeping present wage structure will you motivate your son or daughter to join the company?

Strongly Agree ( ) Agree ( ) To some extent ( )

Disagree ( ) Strongly disagree ( )

7. Are you agreeing with the process of calculating incentives?

Strongly Agree ( ) Agree ( ) To some extent ( )

Disagree ( ) Strongly disagree ( )

8. According to you what the people other than ONGCians feel about your salary structure?

Jealous ( ) Self-conscious ( ) Happy ( )

Honored ( ) Doesn’t bother ( )

9. How do you find your salary/wages in comparison to:

e. Industries:

Highly satisfied ( ) Satisfied ( ) To some extent ( )

Least satisfied ( ) Not satisfied ( )

f. Qualification:

Highly satisfied ( ) Satisfied ( ) To some extent ( )

Least satisfied ( ) Not satisfied ( )

g. Experience:

Highly satisfied ( ) Satisfied ( ) To some extent ( )

Least satisfied ( ) Not satisfied ( )

h. Work load:

Highly satisfied ( ) Satisfied ( ) To some extent ( )

Least satisfied ( ) Not satisfied ( )

10.What is the major factor that influences the morale of the employees?

Nature of the working condition ( ) Supervision ( ) Interpersonal relation ( )

Management policy ( ) Wages and salary ( )

11.What do you think about the Post Retirement Benefit Scheme of ONGC; does it match employee retirement saving contribution?

Strongly Agree ( ) Agree ( ) To some extent ( )

Disagree ( ) Strongly disagree ( )

Any suggestions: ________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

BIBLIOGRAPHY

BOOK REFERRED Human resource manual – ONGC Reports on Human Resource Management In ONGC, Tel Bhavan, Dehradun Wage And Salary Administration in India-Alka Gupta

WEBSITES VISITED ongcreports.com ongc.com ongcindia.com