A different pay structure would be determined by Public sector banks (PSBs), if the recommendations of a government-appointed panel get the nod of the Mr Pranab Mukherjee, Union Finance Minister.
Instead of the current industry-level arrangement, the entire wage decision should come to the bank level, the Committee on HR issues in PSBs, headed by the former Bank of Baroda Chairman and Managing Director, Dr Anil Khandelwal, has suggested.
The recommendations were based on the grounds that each bank has a unique set of problems so wages should be decided at the bank level instead of industry level.
The Khandelwal committee focuses on the performance management i.e. each employee should be rewarded on the basis of their performance, irrespective of the categories. In order to sustain a high-performance culture in PSBs, it proposes that 2 per cent of net profit to be allocated for incentives and rewards and also recommended employee stock option plans (ESOPs) to 15 per cent top performers.
Several corporate governance reforms have been suggested, including the need to review the entire board composition so as to bring in more domain specialists and separation of the post of chairman and managing director. Adopting committee approach in PSBs for sanctioning large credit has also been suggested.