Saturday, July 23, 2011


Now it has become a routine for all the retirees to quote the LIC case of Pensioners and ask us whether it is beneficial to us, etc. Let me explain what the case is all about.
The DA pattern adopted by the companies for payment to pensioners on cost of living index differred for those retired before 31/7/97, and for those who retired after 31/7/97.
The formula followed for those before 31/7/97 was, as per Basic Pension and for those after 31/07/97 is as per Basic pay.

Let us take an example that a person who retired after july 97.
DA is calculated on his basic pension as per the formula down below.
1)upto 4800 0.35%,
2) above 4800 upto 7700, 4800 0.35%+ from 4801 to 7700 0.25%,
3)above 7700, 4800 * 0.35%+ from 4801 to 7700* 0.25% + 7701 to 8200 *0.17% and
4)over and above, 4800 * 0.35%+ from 4801 to 7700* 0.25% + 7701 to 8200 *0.17% + more than 8200 * 0.09%.

But the pensioner who retires before july 97 will get DA calculated on the basis of 50% of the above amount, ie.
1)upto 2400 0.35%,
2) above 2400 upto 3850, 2400 0.35%+ from 2401 to 3850 0.25%,
3)above 3850, 2400 * 0.35%+ from 2401 to 38500* 0.25% + 3851 to 4100 *0.17% and
4)over and above, 2400 * 0.35%+ from 2401 to 3850* 0.25% + 3851 to 4100 *0.17% + more than 4100 * 0.09%.

The above details will show you the difference of pension. This anomoly was referred to the LIC management and they have readily agreed and passed a resolution in their Board to pay the same which was not agreed to by the Union Govt. Hence the case and the case was won by the pensioners at Division Bench level and the Management at the instance of the Govt. petitioned for review by the Division bench itself which was kept pending and the pensioners of LIC moved Contempt of court.

This ended up in SLP in Sup.Court, moved by the LIC management and the Sup.Court has now ordered review of the decision within three months by the same High Court and stayed the contempt proceedings.

Many of the members of our Association have put questions like, in what way this is going to help us.
This decision, if upheld by Supreme Court, will benefit all the retirees, retired before 31/7/97 in our industry also , and the main verdict clearly speaks about the differentiation among pensioners, who come within the purview of the same scheme is not allowed as several decisions of the Apex court has clearly stated that group among group in pensioners cannot be allowed and there can be cut off date only at the time of introduction of the Scheme and not after that.

Now let us come to the point on how we fall in the above category. We are all governed by the scheme published in 1975 enacted in the parliament and amended from time to time, to revise the pay scales and other benefits, whereas the pension is not revised as and when the pay scales are revised.
This leads to creation of group among group, thereby creating difference in in the pension received, who retired at different period. I am giving you example of the same hereunder.

1987 1992 1997 2002 2007
G M 13958 25705 28003 32671 43212
D G M 13221 24018 25155 29440 38706
MGR 12440 22518 22544 26544 34627
DY MGR 11416 21269 20349 24055 30945
A M 10831 20644 19281 22290 30079
A O 9880.5 19419 17484 19937 27508
AA0 8651.5 18844 16629 18924 24880
Sr.Asst. 11445 16582 13283 15318 19588
ASSt 9661 15083 10673 12353 15805
Rec.Clerk 6909 12995 8003 9273 10372
Sub Staff 5217 10158 6087 6937 8390

The above example will show you where we stand and we will be getting lesser and lessere when the scheme amended time to time without revising the pension which is legitimate.

We are also contemplating on filing a case for equality in pension and we are waiting only for the outcome of our case which is primary responsibility on us.

We will be in touch.



RavindraKondebettu said...

Many thanks for kind & clear clarification. Humble request please post at frequent intervals some information which may be useful to all.

L P GUPTA said...
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