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LICs Meal Voucher Scheme An Observation

The Scheme:
Meal Voucher Scheme was introduced on 01.09.2010 to all class of employees
who come under the purview of LIC (Staff) Rules, 1960.
Scheme is applicable to all whole time employees, regular part timers including
Probationers & officers/employees who are on Deputation to LIC Offices.
The Purpose of the Scheme: (the version of the Management)
The scheme of food coupon has been introduced with the view to increase
employees satisfaction as motivation tools which is manifested in team-work,
building client relationship and idea generation.
LIC of India has decided to introduce the scheme of food vouchers as a part of good
human resources practice which is so necessary in the competitive environment.
Board of LIC in its meeting held on 5/5/2010 has accorded approval to the Scheme
of Providing Food Coupons to Officers and Employees as given in the board note
The Conditions:
Attendance for all class of employees (except for Class II, for whom additional
conditions of business performance of 285 policies in a financial year)
The Benefits:
One Meal Coupon per day of varying values according to cadre.
Eligible days for payment of Meal Vouchers:
= Total days in a month less [Sundays/Holidays + Leave + Period of absence of any
kind + Late coming days + strike + on duty for examination + days for which DA is
paid for tour (excluding Sundays & Holidays)
The above formula for all class of employees (except for Class II, for whom the
maximum eligibility is restricted to 285 days)
The Meal Voucher value per day has increased since 2010 as follows:

MEAL
COUPON

CADRE

ZM

SDM

DM

ADM

AO

AAO

DO

HGA

ASST

10

RC

11

CL IV

12

REG PART TIME

FROM
01.09.2010

FROM
01.09.2011

FROM
01.09.2012

FROM
01.09.2013

FROM
01.09.2014

200
175
150
130
110
100
90
80
70
60
50
25

220
190
165
145
120
110
100
90
80
65
55
30

245
210
185
160
135
125
110
100
90
75
65
35

275
235
205
180
150
140
125
115
100
85
75
40

295
255
220
195
165
150
135
125
110
95
85
45

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The scheme which was introduced with good intention has reached a stage where
some critical analysis has to be made as it has started disconnecting Class II.
The Analysis:
Yes, we did not study deeply about the various aspects in minute details. But that
scrutiny would happen only when it pinches. There is a simmering discontent
brewing across the entire cadre because of the bias in the scheme.
The Changes:
The month-wise target was disputed at the inception and hence a yearly review
was offered. Now, the Management is in a fix as the current year business target for
MC is found difficult to achieve. Therefore, it has changed the review to Quarterly
Basis as it foresees a situation where it cannot recover on Yearly Basis.
The Reality:
Lack of plans is hampering and the market has not revived since Jan2014. These
are accepted facts. This is the area where Class II operates with great difficulty with
less than one-third of the earlier number of products for more than ten months.
The management has expressed its concern for such a scenario which is beyond
the control of Class II. When a yearly review of the value is done and increase is
announced in Sep, there should have been a review of the target fixed too.
Presence or Performance:
Primarily, the context of the scheme should be clarified whether it is for presence
or performance. There is a growing disconnect between Class II and others as no
one in the branch level appear to be aware of the real reasons for such
unreasonable conditions for this Class. The market trend is already causing havoc
in the minds of Class II, with the increasing cost ratio staring at them. The revival
of Incentive Scheme doesnt appear to be in their mindset as earned wage security
& job security have been causing a deep distress.
Application of the same definition everywhere:
The duties of a Development Officer differ fundamentally from the other Classes of
Employees of the Corporation. The procurement and promotion of business is one of
the fundamental duties of a Development Officer. Employees of other classes work
for specified time in the office where their output is directly supervised. On the other
hand, the Development Officers have no fixed hours of work.
The above understanding of the Management is right and that is the reason they
have stipulated Special Rules to appraise the performance. Thus after the
application of Special Rules, the Development Officer is given an increment or a
punishment according to the Disincentive table. Even if he earns a disincentive, it
must be understood that he remains a full time employee and must be treated as
such.
The difference between benefits common & unique:
There are certain allowances which are taken for costing like his TE, FCA etc. But
Meal Voucher & PLLI do not come under that purview fortunately. Having accepted
that, the performance parameter should not have been linked to it.
Awareness and Communication:
The branch level management is aware and expresses its concern sympathetically
but the central level administrators seem to lack in empathy.
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There is one great handicap in the system that prevails. The Communication is one
way and it is only downwards. There is no upward communication as the branch
managers are scared to convey even the ground level realities to their higher-ups.
Because of this, they neither have a convincing reply nor do they have ways to
address their concerns.
In this scheme, there are instances which are totally illogical and unjustified. Some
are briefed below:

1
2
3
4
5

DO's who do not have / claim TE & DA for/ touring duties


Total days in a year
Sundays
Holidays
Leave
Touring (DA availed)
Balance- attended days
Payable for Cl I, III & IV
Scenario
1
2
3
No. of Policies
1000
285
275
Payable based on attendance
285
285
285
Recovery based on NOP
0
0
10

365
52
12
5
0
296
296
4
95
285
190

Note: The maximum for Class II is fixed at "285". The recovery is effected using the
formula = 285 (-) NOP during the period.
Observation: Even if one's attendance is more than 285 days (296 in the above
example), he will get only 285. Thus the entire attendance is not taken into
account. Similarly, when performance exceeds NOP 285 - be it 285 or 2000, there
is no difference. Thus, there is no logic in fixing the number "285" for either
attendance or NOP.
DO's who claim TE & DA for touring duties
1
Total days in a year
365
2
Sundays
52
3
Holidays
12
4
Leave
5
5
Touring (DA availed)
120
Balance- attended days
176
Scenario
1
2
3
4
No. of Policies
1000
285
275
95
Payable based on attendance
176
176
176
176
Recovery based on NOP
0
0
10
190
Observation: The DO in the above example, is eligible for a maximum of only 176.
Here, the number "285" has no relevance for attendance and is applied only for
NOP performance, that too for recovery purpose. The individual, even if he does an
NOP of 285 or 2000, he will be getting only 176. The recovery formula is "One day
MC cut for one NOP deficit from 285. Actually, he gets one MC per day for only 176
days and not for 285 days. Scenario 3 above shows that even if he does for more
than what he takes (275 NOP for 176), he loses out 10. Scenario 4 above is
pathetic. If he does less (95 for 176), recovery is not (176-95) i.e. 81 BUT (285-95),
that is, 190, which means, he receives 176 and pays back 190. (Received:
Rs.22000; Recovered:Rs.23750 @125 per MC)

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Matter of Facts:
Thus from the above chart, the touring DOs will never have the privilege of
getting the maximum earmarked (285) for DOs.
But his target for NOP is fixed at the same 285.
There is no provision for reducing the target proportionate to the days on
leave.
One may come across a situation, where Medical leave is availed for some
serious treatment or availed maternity leave and this may extend for a
period of six months. If it happens to Cl I, III or IV, then in the remaining six
months, they would get MC according to their attendance. In the case of a
Development officer availing such long leave, he will have to carry the
burden of Yearly 285 and fulfill it in six months. There is no provision for
waiving NOP for the period on leave.
It is mentioned that MC is not payable on the days where DA is paid for
touring duties. It must be understood that the TE & DA that is paid to a
development officer is built into his cost and literally he pays back this
amount, when his appraisal is calculated, in the ratio of 5.26 times or 5
times or 4.76 times or 4.55 times according to the Expense Ratio 19% or
20% or 21% or 22% as the case would be. This is not the case with Class I,
III & IV. Thus, on touring days, to curtail MC which is not included in the
cost is not reasonable. The portion of MC at least must be removed from
the DA reimbursed on touring days.
It may also be noted that the MC at present has two values before & after
September and keeps changing every year.
It may also be noted that Sodexo MC is not similar to a currency And MC is
not part of the salary or other monetary remuneration.
The chain stores which accept Sodexo MCs are
the costliest in the market. The beneficiary,
exchanges Sodexo for a price which would
comparatively be less with a local kirana. The
beneficiary would not have gone to these Sodexo
outlets, if he wants spend in rupee value. Thus, the value of recovery is
perhaps, not the price of what the beneficiary has consumed in the market
but the one that Sodexo has billed the employer.

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The recovery of MC (Annual Review) was earlier guided by circular of


Marketing department MKTG/ZD/4/2013 dated 28.01.2013.
After that there are circulars dated 07.10.14, 13.10.14 by Mktg and
circulars dated 31.10.14 & 14.11.14 by Audit Dept., CO.
The circular of Mktg dtd 13.10.14 is issued as clarification (after our
representation) and doesnt mention about one time recovery (OR) recovery
by cash (OR) recovery from salary. Point no.2 in the aforesaid circular
mentions that shortfall has to be recovered by meal coupon payable for the
subsequent quarter. And nowhere it is mentioned to recover by payment or
salary cut.
The circular dtd 13.10.14 is the latest one issued by the Marketing Dept.,
CO.
The latest circular of Audit dated 14.11.14, advises to go by the latest
circular of the Mktg.
The circular dated 7.10.14 point (d) insisted on recovery by cash equivalent
in one go within the same financial year. However, the latest circular dtd
13.10.14, states in point no.4 that recovery must be effected after the yearly
review in the first week of the subsequent financial year.
From the above clarifications, it is observed that latest circular from the
Marketing is not for recovery by cash or recovery from salary.
There is no guideline on the reduction of income tax liability because of this
recovery.
There is no guideline on whether proportionate reduction expense ratio will
be considered as this affects the annual remuneration.
Payment towards backlogs of recoveries at one go (OR) recovery from salary
hampers the take home portion of the salary of the employee and his
monthly contribution towards domestic needs get affected.
Further, these recoveries directly impede his funds normally provided for his
touring & other marketing related activities.
Therefore, keeping an eye on the family obligations and the need for
Marketing Expenses, recoveries may be effected from future payable meal
coupons.

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An Appeal: The Meal Voucher Scheme was introduced with a good intention of
recognizing the employees contribution at work place. It is part of improving HR
practice and as a tool to improve employees satisfaction and motivate them.
All sections of the employees across the cadres must have the same parameter and
there must not be any prejudice towards the sincerity of one particular cadre.
This scheme is not a competition programme to stipulate a minimum NOP for
becoming eligible for MC. This scheme is for ALL and is a welfare measure to make
them feel part of the Institution and proud of their Institution.
There are always a small percentage of employees across the cadre who may not
match with the expectation and might perform less than the average. For improved
performance, it is prerogative to take care & help that small percentage to improve
upon and make them feel that such welfare measures are inclusive of them too.
This empathetic attitude would be a great source of inspiration not only for the
deprived segment but for the entire cadre which represent them.
Conclusion:
The Meal Voucher Scheme is based on the concept of attendance. It implies that an
employee is given MC for each day of his attendance excluding tour, holidays etc.
On the contrary, if a Development Officer is not sanctioned MC or if his MC is
recovered, does it take away the work that he has performed on those days?
Therefore, to be fair, the Scheme must be without any conditions on NOP.
This scheme is not a motivator for doing business. That motivation could be only
from an Incentive Scheme. This scheme is to make one feel inclusive in the
system.
The success of any scheme is seen in improving the morale of its employees and it
becomes all the more imperative to ensure that it doesnt result in demotivating
their spirits.
We are hopeful that the sentiments of the Development Officers are given due
importance and the conditions for performance is not insisted for Class II also.
(This is a compilation of experiences and feelings shared by our friends)

Best Wishes & Regards,


~ts.rajan~
10.11.14 / updated 05.12.14
tsrajanlic@gmail.com

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