Rohit Bajaj has a job with a small US company. Based in Delhi, he is practically a one-man show. But the one man is doing good business. And he has been well looked after.
A small cloud has appeared on the horizon, however. All these years, he was earning less than his counterparts in the US. He was told that in terms of purchasing power parity, he was much better off. He could afford a chauffeur and two servants. All his colleagues in the US, including the CEO, drove their own cars. And they had an arrangement with a service company to come and “do” their houses.
While economies across the world have slowed down, they have affected salaries in different ways. In the US, the pink slip period appears to be over. But salaries have been frozen for many employees. The average increase — according to a Culpepper survey — is 3.11 per cent. In India, on the other hand, the increase is estimated at 11.9 per cent, according to a Aon Hewitt survey. What’s more, according to a TeamLease analysis, in India macro-economic conditions do not matter while rewarding employees.
Bajaj, as a star performer, could have expected a 20 per cent increase had he been working for an Indian company. But his bosses in the US have told him that he will have to settle for 3-4 per cent — in line with what everybody else will be getting. His hope of catching up with his peers in the US looks even further away.
There is a silver lining, however. His boss in Boston has pointed out that his take-home has actually gone up some 20 per cent because of the depreciation of the rupee. Even without a salary hike, he is much better off.
Yes, Bajaj spends only in rupees. The foreign holiday may be out. But going to Agra today looks so much more affordable. So should he just accept this with good grace?
Bajaj has sent an email to his HR head in Boston. Suppose the rupee were to strengthen, would you compensate me for the decrease in my salary? The HR department will not put anything down on paper. But they have told him quite clearly that the question does not arise. Folks in his company are anyway envious of him. They will go hyper if there is such a safety net built into his salary.
What should Rohit Bajaj do?
“In such a situation, you should first measure your value to the company,” says Mumbai-based HR consultant D. Singh. “Particularly because it has been a one-man show, you are probably of greater value than the head office or you realise. Look at how easy or difficult it will be for them to find a replacement. Will they transfer you to head office — with the attendant increase in expense — if you insist? Can you use that as a way of coming back to India at a higher salary? It can only happen if you are so good that nobody can replace you in the short term.”
“Having done all this, prepare a presentation,” continues Singh. “At some stage you are sure to meet your boss or somebody very senior in the company face to face. If that doesn’t happen, use email, but that should be a last choice. Communicate your point of view.”
The key thing is not to rock the boat immediately. The folks at Boston probably know what your feelings are and they will appreciate the fact that you didn’t add to the crisis. Presenting your accomplishments is a way of saying that what is for all practical purposes a pay freeze is not acceptable. You have been reasonable; you have been loyal. If there are no positive strokes coming from Boston, it is time to make a move.
Before all this, you should assess the market. There is no point carrying a big gun if you have no ammunition. The worst thing you can ever do is return to your company with your tail between your legs.
Salary increase in 2012 (estimates in %)
Africa & Middle East
Salary Budget Survey