Labour Law & Hr Consultant
Retired Chief - Ir
Working As Manager - Hrd & Admin In A
No employee can demand periodical increment or hike in salary as a matter of right unless there is a settlement providing for such hike.
Increment or periodical hike is an important factor in wage/salary administration of an organisation for motivating the employees to keep their contribution to work at optimum level with the passage of time and also to distinguish their seniority in terms of their tenure of service in a perceivable manner. If employees with long tenure of service are paid on par with newly recruited employees, the result is pay compression or salary compression that will end up in low morale. At the same time, no employer will be prepared to hike the salary of a non-performer just because of his longer tenure in the organisation. That is why performance appraisal has come into place. Therefore, increment should not be confused with general hike in salary to off-set raise in prices like dearness allowance. As a prudent employer, if one links the rate of annual or periodical hike with performance and the appraisal is objective, it will certainly motivate his employees to work harder so as to achieve targets if any.
27th April 2016 From India, Salem
27th April 2016 From Ghana, Accra
28th April 2016 From India, Mumbai
Annual increments in basic salary are at the discretion of the management. Normally it is linked to the performance management system - achievement of the KPIs/KRAs.
If there exists any tripartite agreement with the union for grant of annual increments subject to fulfilling conditions detailed there in, then it will be automatic if the conditions are fulfilled.
In case of breach in such agreement you can take it before the Labour Department. Otherwise there is no law which provides for annual increments.
3rd May 2016 From India, Vellore