'Raise'ing reactions

Indra Nooyi’s recent remarks on pay hike have reset the discussion on the need to upgrade industry standards, recognise and retain talent by offering a fair ‘earn and learn’ space
Indra Nooyi (Photograph by Dave Puente)
Indra Nooyi (Photograph by Dave Puente)

CHENNAI:  As much as Indra Nooyi has served as an inspiration for generations of women and girls, greatly contributed to the growth of the PepsiCo empire and done much in the world of corporate business, she has had enough of a reputation of foot-in-the-mouth media moments. When the latest faux pas occurred during the recent interview with The New York Times, it — naturally — drew some serious flak from across the board. On Twitter, reactions to Nooyi labelling the practice for asking for a pay raise as “cringe worthy” ranged from questioning her privilege, calling her out on the ‘bad advice’ to reminding everyone about the brief but painful existence of Pepsi Blue. 

Since the collective outburst online, Nooyi attempted to set the record straight on her comments. Presenting that they were taken out of context, she offered that her views were a result of an upbringing that discouraged asking for anything. While Nooyi’s family might have had a number of morals and principles to stick to these rules, the world of work also seems to have adopted these very, archaic sentiments in the place of a mutually beneficial barter system. Replicated enough times, this arrangement no longer rewards the right people. While other corporate leaders and business owners may not be advertising their views for the whole world to see, it’s evident in the treatment of their employees — from grossly falling short of industry standards of compensation to adopting gaslighting techniques to keep the profit margin wide and clear. 

Illustration: amit bandre
Illustration: amit bandre

An unfair world?

The likes of Jonathan Max and Angeline Babitha have experienced it the hard way. Employed at a fast-growing IT products company in Chennai (one that saw tremendous growth even through the pandemic), Jonathan was in for a raise this year. Yet, when the time came, he had found his raise to be significantly diminished; especially in comparison to his fellow team member who did the same work. He discovered that his base salary itself was 50 per cent lower than his colleague’s. “When I found out about it, I took it up with the management. They tried to reason that our circumstances were different and hence the pay was not the same. They did try to shut me up by moving around some logistics. I did get a pay raise after asking for it, but it was still nowhere close to what I had expected,” he says. 

While such a comparison may not hold good in all situations, this seems to be a common grievance in many workplaces. It is only natural when companies put all their energy into hiring new talent with a substantial hike (from their previous salary) but fail to revise the incumbent’s pay in the same way. “A software engineer with five years of experience gets one salary. When the company wants a new engineer with the same level of experience, they tend to offer them a higher salary than the one in-house. When the existing employees don’t get the same benefits, they naturally look to move to a different company,” points out Babitha. Her personal experience, however, was marred for other reasons. 

While Babitha didn’t get a chance to ask for a raise at her previous job (at a technology firm), it came to her when she least expected it. “The work was not recognised in all the years I was there. At every appraisal, the increment was minimal. When I wanted to resign, however, they offered to drastically increase my salary. They even offered a work-from-home option and freedom to pick and choose the shift I preferred. That was quite unexpected,” she narrates. Her current place of work, however, has fared much better in these terms, she says. While they had scaled down appraisals since the start of the pandemic, her request for a reasonable raise — based on her experience, work output and market standards — was willingly accepted, she shares. 

Priorities aplenty

Parthipan Vyasai, an independent HR consultant who has been in this line of work for over 10 years, lays down the reality of the corporate world — business people are not service-minded. “They are concerned about their own growth. Then, they are not likely to look out for the employee’s growth or wellbeing. In the place of one worker earning a salary of `50,000, they will look to hire three for `10,000 each. They don’t think about the loss of talent from the employee leaving,” he offers.

The practice where employees are fairly compensated for their work (either automatically or through a regular feedback loop), is not all that common. In too many places, this is by design, suggests Ravi*. “The HR has the criteria of maintaining the standards. When a unit comes up with a requirement, they approach HR and begin the process of recruitment. But the unit would have a budget for the purpose. The HR would have to find a good candidate well inside the budget and save some money and thereby bring a good name to the team. I’ve never followed this process but I’ve heard of this being done in many places,” reports Yuvaraj, who is part of the HR team at an international financial institution. 

Sanjay Suri points out that hiring strategies depend on what the company can afford and the kind of talent it wants to attract. “If you want the best of the best, then most probably you will have to pay a really high market rate. If you are okay with a person (who accepts an offer of) 75 per cent the market rate, expect that they might not be as great as they can be; we don’t know,” he surmises. While such reasoning may seem universal from the point of view of the hirer, it discounts the fact that people accept jobs for a number of compulsions that doesn’t allow them the luxury of waiting for the ideal — be it in compensation, work culture or growth opportunities. 

The way of the world

Going a step further from common perception, Suresh Sambandam, CEO of Kissflo, suggests that 80 per cent of companies do adhere to fair compensation norms. “By and large, most companies recognise performance, talent and contribution, and increase salary or give promotions. That already happens. So I don’t know if you need to explicitly ask for it unless there’s discrimination; in which case, you actually have to register a complaint. If salary discrimination is happening because of gender, colour, race, community, then you’re really talking about taking legal action. I want to differentiate between these two things,” he explains. 

For those stuck in companies where pay standards are poor to begin with — and hence, find little room for growth — it’s a short-term problem, he suggests. “Say a software company A offers Rs 40,000 salary and B offers only Rs 20,000, there’s a short term gap. If there’s a talented person who is getting Rs 20,000 and can get Rs 40,000 somewhere else, he’ll eventually go there. A lot of people will follow suit and then the company will understand that if they don’t adjust the salary, people will leave. They will come back with a revised structure. So, the market forces will take its own correction. There might be short-term problems but the free market will fix these problems,” he offers. 

“With many new players (start-ups) coming into the business ground, the idea of ‘industry standards’ is slowly getting upgraded to something like a bidding,” says Ajay Vijayaraghavan. “Based on the business need, companies attract talented employees with higher CTC and other flexible benefits. (On the other hand,) we see a lot of employees stay in the same organisation amid a meagre salary hike; they quote a comfortable working environment or interesting work challenges as factors,” he points out. 

Suresh has witnessed something similar too. “People come to work for a company for two reasons — earn and learn. Some people may choose to learn more and earn less. They might be getting Rs 10,000 less but they will probably learn a lot more and so will be willing to forgo the Rs 10,000. And when we talk about work culture, we’re really talking about being in an environment that makes this ‘earn and learn’ easier — with less friction, frustration and stress but more happiness, flexibility and clarity. Any work culture that lets employees unleash their potential is the best,” he offers. 

“Love the job and not the company,” suggests Parthipan. “Be it loss or profit, the owner takes it all. So, there’s very little we can expect along those lines. We should be focused on our job and keeping ourselves updated. If after three years of work, you find that there is no genuinity in the pay offered, you should look for better options and move out,” he advises. 

For the benefit of employers, Sanjay points out that the only way to retain good talent is to keep them challenged in the role. “Generally people don’t leave for the pay; they leave because they are not treated well or they don’t learn enough at the job. As long as the pay is fair — and fair pay is different for different people — within the organisation, and not completely out of step with the market, you can still get people to stay as long as they are challenged,” he concludes.

Looking past the status quo

Geetha Ramakrishnan of Unorganised Workers Associaiton, having worked with this section of labourers, has a different take on the question of what Nooyi said. Be it the sentiment Nooyi expressed or the clarification that came later, would it apply to unorganised workers who struggle to make even minimum wage? “Wage should not only take into consideration the basic needs of food, housing and clothing but also education, medical support, cost of living. Though the last two years we say we have been recovering from Covid, the unorganised labour (sector) has taken a big hit,” she points out. These arguments lose meaning when it comes to this section of workers whose numbers stand at over 50 crores now, she adds. With the added problems of discrimination, migration and the arrival of amendments to the labour laws in the sector, it’s all the more reason to shed this outlook that continues to be feudal in nature, she suggests. 

* Name changed

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