Trade unions divided over CEOs' pay cheque

Trade unions divided over CEOs' pay cheque

On Tuesday Left-affiliated Centre of Indian Trade Unions (CITU) asked the Centre to frame laws to put a cap on the salary of CEOs while another major body said the move will not be productive for companies.

Disapproving fat pay packages for the CEOs, Mohd Amin, general secretary of CPM-affiliated trade union CITU, said the government should bring strict law to regulate such high salaries.

However, the Indian National Trade Union Congress (INTUC) argued against the demand for a legal regulation and said that it was not necessary. “CEOs’ salaries were raised to match the standards of multinational companies and if you try to reduce salaries, it may affect their administration as well as image of the company in the market,” INTUC president G Sanjeeva Reddy said.

The corporate sector has already turned down proposals for restrictions on salaries as that might lead to flight of talent. Alleging that the government was not keen to bring about such regulations Amin said it was acting under international pressure to see that privileged people could enjoy their status uninterruptedly.

Echoing Amin’s view AITUC secretary D L Sachdev said maximum remuneration should be fixed just like minimum wages. He also urged trade and industry chambers like CII or FICCI to regulate CEOs’ salaries. Amin’s colleague in the CPI, D Raja said government should be pro-active in ensuring that companies seeking bailout do not retrench workers or cut their salaries.