Dinesh Divekar
Business Mentor, Consultant And Trainer
Partner - Risk Management
Ed Llarena, Jr.
Owner/ Managing Partner
Retired From Air India
Sr. Manager Hr
+4 Others

Dear Members,
One of my friend has recently joined one real estate company in Mumbai which is 50 year old organization. All employees in the company are very senior working with organization from 10-25 year. They all are either 10 or 12 passed only. Hardly a few have done some diploma courses in engineering.
Most of the senior employees does not have their education certificate.
My friend is first HR hired in the organization in past 50 years. There are new hired too in the organization now sine my friend has joined. They all are well educated & have done many diploma courses.
Now management has asked my friend to set salary & designation for all employees. Here my friend has asked for my help.
I am really very much confused how to do this coz old employees, but no educational certificates. New comer well educated with lots of professional courses. How to justified both.
I need your support & guidance to help my friend.
Warm Regards
4th April 2016 From India, Mumbai
Dear Ravita,

Thekedar-Munshiji culture is the mainstay of construction companies of India. It appears that your friend's company has practiced it to the core. In fact what was the logic of recruiting HR is not understood. If the management could run their company without HR for the last 50 long years then they can very well do so for the next 50 years as well. How come this sudden realisation that businesses require HR too?

Bringing change in such organisations is very difficult. This is because companies of this kind run like mafia. As such in India, construction business is more run because of nexus with politicians, government officials and so on. Who cares about the knowledge of the civil engineering or the world-class construction standards? Recent collapse of the bridge in Kolkata is case in point.

In the company where your friend is working, personal allegiance overrides professionalism. Against this backdrop, find out from your friend what HR interventions are acceptable to his boss. This is because, any intervention would need support from the management and also from the people. Second challenge would be the direct dealing with the boss. Your friend is a newbie. At least for HR matters, top boss should not bypass your friend. Your friend's challenge is double-fold. One is that people lack of requisite qualification and second one is personal loyalty developed out of the long stay. Value addition from HR will come provided your friend has sufficient empowerment. Else his role would be to become yet another yes-person of the flock of yes-persons.


Dinesh Divekar

4th April 2016 From India, Bangalore
Dear Ravita,
It is a very big challenge for your friend. He has to maintain a balance between experience and qualification. You can not ignore experience for the sake of qualification and you can not ignore qualification for the sake of experience. Since changing the traditional work style of the company is difficult, the criteria here should be experience and then qualification. However, to maintain equilibrium consider qualification for experience depending on the talent and skill of the person. A professional approach is vefy difficult in this case as your friend may not necessarily get support of Management.
4th April 2016 From India, Bangalore
Designations, is something the owners have to take a call on.
You should make an organisation chart first to help them decide who,should do what and report to whom.
The line and staff positions should be separated and the dotted line reporting should also be clear.
About salary, first you need to see what market will pay. If you try to,pay new people what the old ones are getting most will probably leave pretty soon. But you also need to try and keep the salary same for new and old employees for same function. The new have qualification and the old have experience, both of which you need. Then you should set up a performance evaluation system. The salary scale up should be based on that. The salary differential will start coming in as the performance and achievements filter in
Of course, at each step, and for the grand long term plan, you need to ensure that your owner has a birds eye view and approves of your approach
5th April 2016 From India, Mumbai
Dear ravi
Tell to your friend that
Give more importance to seniors who have worked for last more than 15 years
You fix the salary according to
1.Seniority & education
2.Education Highest level
3.Seniority no education
5th April 2016 From India, Bangalore
As rightly pointed out by our Seniors ; 50 yr old Co. running with 20-25 yrs. expd. employees; now attempting to give Designations, fixing salaries based on Qflcn, Exp. etc.,is a Sensitive issue especially; if the no.of employees are more. It will pose a great heart burning if all are not convinced/satisfied about their post & pay & anomalies are bound to happen.
A thurough study of the existing employees Qlfcn., exp. etc., tobe reviewed & appropriate Designations & pay scale/payband with yrly increment etc., tobe considered. It is a hurricane job & expert in the same field can be requisitioned to solve the problem once for all.
Sooner it is done, the better it is for Co.Management, Employees & HR Head. WISH U GOOD LUCK.
HR Consultant 5.4.16
5th April 2016 From India, Mumbai
How well is your company doing in the industry as compared to peers in the same field?
What is the existing pay structure?
Are they on par with other firms in same business/?
How many qualified employees v/s experienced employees?
In construction business,experience plays a vital role for successful implementation of projects.
A supervisor who has come up using brick and mortar may sometimes be more knowledgeable than a degree holding/diploma engineer who is all theory but no practise.
So do not just go by mere degrees etc.
Matter needs to be fully discussed with the boss.
The boss should be in line with your thought processes.
Before you go to boss-do a lot of home work like designations,job requirements,descriptions and organisation chart.
Sensitive and careful dealings will be most important to prevent sudden heartburns and departures.
5th April 2016 From India, Pune
Thank You So Much Mr. Nathrao for your suggestion.
Well the company does not stand among Top builders in Mumbai I mean is not well known but still have a good report because of its legacy & good work. Employee strength in the organization is approx 80.
90% of employees are old (In terms of years of working) having 15-30 years of experience. Mostly employees are SSC & HSC. Package is not as per top companies but is equal to Mid level organizations.
An MBA holder with 9 years exp getting what salary , the same is paid to seniors who have done HSC with 20 years exp. Designation for both too is same.
There the conflict can be !!
5th April 2016 From India, Mumbai
MBA with 9 years experience-now in which field,what is he employed on in the company,is it correspondence or fun time MBA-these type of information would be required to decide.

Weightage to seniority and qualifications will have to be worked out.

I would initially give experience a higher weightage.

Conflict can be reduced but not avoided in this situation.

Some new employees may leave or even older employees.

Be prepared for this fallout.

Move forward after discussion with top bosses and keep them in the loop about likely fallout and whether they are ready to face it.

Omelette cannot be made without breaking eggs.

End result of change should be that organisation is more ready to face competition.

New blood will be more ready to face change,older lot may be in traditional mode and say-we do things this way-which may not be suitable for modern and competitive times.

Task is tough but with clear ideas,compromises and alternative ideas it can be achieved.

may not be possible to have total revamp at one go,but process of revamping can begin and seeing outcome carry on,make changes etc.
5th April 2016 From India, Pune
Dear Ravita,
As a first job, what you and your friend need to do is to make proper organisation chart. Unless you make this chart, there is no point in deciding about the salaries. There has to be clarity as to who reports to whom. Then you need to find out whether a case where junior has more salary than senior in the same department. You need to fix these issues first.
The next thing is about measures of performance standards. Salary is also based on the ability to meet desired level of performance. Rewarding length of service is dangerous. That anyway your employers did hitherto. You cannot continue this practice ad infinitum.
Dinesh Divekar
5th April 2016 From India, Bangalore
Thanks Mr. Nathrao & Mr. Divekar. :)
After all suggestion I have reached to conclusion that my friend has to keep three things on priority while making hierarchy:
People who are senior yet good performer and key person of the dept/organization should be given first priority and after wards.
This is also a fact that at the time of our parent hardly people would have gone for higher/professional education thus here in due respect to seniority & system we will have to consider experience even with less qualification.
Secondly new comer with higher education & having industry experience can be kept along in the same team and both can work together on same post & salary using their experience. Those who don't agree can leave.
Hope this would be the best for both employee & employer.
6th April 2016 From India, Mumbai
Dear Ravita,

I recommend you revising your approach. You have got stuck into traditional debate of qualification Vs experience. However, what matters is ability to deliver. A person may be qualified or may not be, may be experienced or may not be however, what matters is performance. Therefore, you will have two options to retain the existing manpower. One is those who are not qualified but meet deliverables. Their length of service does not matter. Secondly, those who are qualified but have fewer years of experience. Performance should be bridge between employer and employee and neither qualification nor length of service.

Nevertheless, to do this, what matters is deciding on the measures of performance. I recommend you doing this first. Once you do this, let the employees be filtered based on performance. However, to do this, you need to hire external consultant. For help if any, feel free to contact me.

Further you have written that "This is also a fact that at the time of our parent hardly people would have gone for higher/professional education thus here in due respect to seniority & system we will have to consider experience even with less qualification". Excuse me gentleman, this is your a priori statement and is not acceptable. Professional civil engineering companies existed in the field of civil constructions even 40-50 years ago.

The problem with the civil engineering field is that government did nothing to regulate it. Take the case of ownership of medical store. The owner must be either D Pham or B Pham. Now there is no such qualifying criteria for those who work in civil engineering. Since there were no entry point restrictions, any Tom, Dick and Harry became builder. Owners of your friend's company appear to be from such category. However, let us not rationalise issue on this count.


Dinesh Divekar

6th April 2016 From India, Bangalore
Dear Ravita,
Two things come to my mind.Since the company is 50yrs old and now toying with the idea to streamline it's HR , in all probability someone fron the new generation of owners has started taking active interest in company's working.It's good and definitely a welcome change.However I don't think there is anything wrong in a very senior employee getting paid the same amount or more than a more qualified fresher.From personal experience , I remember that when I had joined my company some sub staff were getting more than what I got.But then they had more than twenty years of service and had contributed their bit in its growth !
7th April 2016 From India, New Delhi

I would like to understand the question as a problem for determining the relative value of employees who got long work experiences without formal educational credentials VS new employees who are academically equipped with certificates and/ or degrees.

If I got the question right, then the problem is a compensation matter and will have to touch on principles and practices that are used in compensation management. The first is: we have to be clear that the "jobs"(positions) and "incumbents of the job" (employees assigned to do the job) are two different matters. Then jobs are evaluated, graded, classified, and given certain salary rate ranges based on the prevailing market median market rates. The rates suggested therein are for anyone who would be classified and assigned to such job grades and job classes.

In this situation, the problem of HR is how to assign those with educational certificates and those who have no certificates, BUT with long years of related experiences.

If you agree with this premise, then the next thing to do is to determine the evaluation factors that would be acceptable for the company ---- as being fair and objective.

Best regards.
8th April 2016 From Philippines, Parañaque
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