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Negative Incentive Policy

Last post December 30, 2016 06:42 AM by raghu. 1 repiles.

December 30, 2016 06:34 AM 1
Total Posts: 21
Join Date: August 31, 2009
Rank: Executive
Post Date: December 30, 2016
Posts: 21
Location: India

Negative Incentive Policy

Hello,

I have joined this organization recently and have learnt there is a negative incentive policy in effect at our manafacturing facilities. This is from the productivity perspective and linked to wages of workmen. To say, a workman has to deliver a fixed output per day which failing which there shall be a deduction in his wages..

Since I haven't encountered such a situation in my past employments, I want to ask if such is legally valid?

Thanks,

Lingam

December 30, 2016 06:382
rammohan
Total Posts: 26
Join Date: August 31, 2009
Rank: Executive
Post Date: December 30, 2016
Points: 130
Location: India

Re: Negative Incentive Policy

Dear lingam,

I think a salary deduction for not meeting specified production targets can be a violation of payment of wages act. You may want to discuss with your legal counsel and discuss with management, if need be, to manage as this can be a sensitive scenario and could have legal implications as well.

Ram

December 30, 2016 06:423
raghu
Total Posts: 51
Join Date: August 31, 2009
Rank: Manager
Post Date: December 30, 2016
Points: 255
Location: India

Re: Negative Incentive Policy

I can tell you from my past experience of having faced a similar situation couple of years ago - if such a practice has been in place for a long time, then culturally it shall be difficult for you to challenge the status quo / mindset or for that matter reverse such a policy. Nonetheless, I suggest you flag it off to management for their consideration as you're obligated to highlight such a practise and related legal implications from HR/ER perspective and then decide the course of action.