National Commission on Labour (1967)||
17.6 A team of Russian experts studied the applicability of incentive schemes to public sector undertakings in the year 1960. According to it, the then existing wage system in public undertakings was not based on the efficiency of the workers but on their length of service and was anomalous in as much as workers doing identical work in quality and quantity got different wages. The team suggested the desirability of reducing the wage differentials for similar occupations and relating wages to skills required of labour and the equipment operated by them. It felt that the system of fixing wages on the basis of seniority should be progressively done away with by switching over all workers to a system of payment based on quality, skill and quantum of labour. Since achievement of the desired output depended on the effort of engineers and technicians as well as that of the personnel of administrative departments, It recommended payment of bonus to them as well. The creation of a fund out of the profits and savings resulting from increased production in the undertaking for welfare activities and improvements in production equipment was another suggestion. A recent study of labour in selected public sector undertakings reveals that productivity has been progressively increasing and unit costs falling in the Chittaranjan Locomotive Works where incentive schemes have been in operation since 1954. The Indian Telephone Industries, Bangalore, has a system of incentives by which both operatives and others benefit. Persons whose time is not directly booked on a job, i.e., operatives in the service departments and service shops, are also
covered by the scheme. Among the other public sector undertakings which have such arrangements are the Hindustan Steel Ltd., the Hindustan Antibiotics and the Hindustan Machine Tools.