Salary Secrecy Ob Ppt

8/8/2019 Salary Secrecy Ob Ppt

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Should salaries be kept secret?Organizational BehaviorNovember, 2010

Bhavya Khurana (10DCP- 065)

Kapil Agarwal (10DCP- 071)

Manu Vijaykumar (10DCP- 076)

Mathew Joseph (10DCP- 077)

Mridul A. Greenwold (10DCP-078)

Sahil Panjwani (10DCP-089)


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1. Brief Overview of Subject companies

Bharat Petroleum Corporation Limited

Kent Builders & Developers

2. Research methodology

3. Inferences

The Case for secrecy of salaries

The Case against secret salaries

4. Equity theory

5. Conclusion

Contents


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Bharat Petroleum Corporation Limited (BPCL) is one of thelargest state owned oil and gas company in India.

It is involved in the refining and retailing of petroleumproducts.

Fortune Global 500 rank of 287

BPCL is often referred to as an MNC in PSU garb. It isconsidered a pioneer in marketing initiatives, and employsBest in Class practices.

Bharat Petroleum Corporation Limited


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Kent Builders & Developers

Kent Builders & Developers are creators of premiumresidential and commercial projects since 1987.

They have covered the entire gamut of construction ventures inresidential projects, integrated townships, IT parks,commercial complexes and hospitality sector.

They have received the Sky Lounge award and the Bajaj Houseaward


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We have considered a sample of twenty people from the two companies

Kent Developers had the policy of keeping the salary secret

BPCL revealed the salary of their employees

Information was gathered with the help of a questionnaire preparedwhich included five questions which are as follows:

Should salaries be kept secret?

Will you reveal your salary to peers if it is kept secret?

What are the benefits of keeping the salary secret?

What are the benefits if not keeping the salary secret?

Any other comments?

Research Methodology


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Agree, 70%

Disagree, 30%

70% respondents supportedtheir companys policy.

Agreement with companys policy


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Case for secrecy of salaries


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Name & designation Reasons

M. F. BalasinorwalaCEO

Prevents increase inWorker rivalry

Namita ShirodkarSecretary

Avoids conflicts withinthe company

Keerthi Reddy SeniorManager

Lose faith in the company

Workers must be on goodterms with each other

Pradeep NagpalCFO

Create bad blood amongworkers

Maintains Goodwilltowards each other

Avoids Confrontations

Dominic RoderickHead of Security

Waist of company time ofresponses

Hussain DaruwalaDoes not effect theperformance

Gaurav NagpalOffice

Administrator

Leads to unnecessary

power struggles

Maintains goodwill

Avoids conflictswithin the company

AvoidsConfrontations

There is no benefitof disclosure

Leads tounnecessary power

struggles

Lose faith in thecompany

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Case for secrecy of salaries- Kent


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Top reasons in support for salary secrecy

1. Avoids employee conflicts/maintains goodwill

2. There is no benefit of disclosure/waste of time

3. Disclosure leads to unnecessary power struggle


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Case against secrecy of salaries


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Name & designation Reasons

Akhil KhambataCOO

Openness and trust witheach other which leadsto a better workenvironment

Encourages confidenceamong workers

Anushil KadamCMO

Secrecy encouragesrumour, gossip andmisinformation

Saifuddin Poonawala

Marketing Executive

Valuable way to measure

one's performance withone's own peers

Better for companieswith large workforce anddepartments withconstant competitionamong them

A way to compareperformance withpeers

Encourages opennessand trust leading tobetter environment

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Case against secrecy of salaries- Kent


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Name & designation ReasonsAshokKumar(sales exec)

Creates trust in theorganization

Amit Sarkar(Sr. manager HR)

Create employeeconfidence in theorganization

Neha Das(Sr. manager mktg.)

Prevents bias

Udit Saluja(Marketing exec)

Prevents bias

Prevents rumors

Mayur Bhatia(sr. manager HR)

Prevents spreading of

rumorsEmployees have a rightto know

Sandeep Mishra(Jr. manager acc)

Salaries will become fair

Dhruv Dhawan

(business strat div.)

Helps distribute work

fairly

Prevents bias

Creates trust in theorganization

Prevents rumors

Salaries will be fairer

Leads to fairdistribution of work

Employees right

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Case against secrecy of salaries- BPCL


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Top reasons against salary secrecy

1. Creates an environment of trust in the

organization

2. Prevents bias/leads to fairer salaries

3. Prevents spreading of rumors


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Application of Equity Theory

1. Kent developers practice secrecy to avoid inequity

Disclosure leads to referent comparison leading to

possible de-motivation.

2. BPCL tries to use inequity as its strength

1. Disclosure leads to competition which provides

motivation to improve efficiencies


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Related cases

Transparent salaries lead to better working environment

Semcos no secrets policy

Brazilian diversified-interests company Semco offers a unique template for profits

through openness. Among a range of workplace democratisation strategiesimplemented during the 1980s, all salaries are transparent and debatable.

The division of profits between workers and managers is fixed; and evenexpenditures need to be approved by a committee of workers representatives.

Far from a fiscal disaster, Semco has become well-known throughout the world forthe success of these initiatives. Its CEO Ricardo Semlar is a respected HR thoughtleader and visiting scholar to Harvard Business School.


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Disclosure leads to fairer salaries

Singapores National Kidney Foundation (NKF) scandal of 2005

Whilst the $600,000 a year pay packet for CEO TT Durai was certainly higher than

most would have expected, it was revealed during a defamation trial that he had alsoreceived annual bonuses of between 80% and 100% of that amount.

Peanuts, one observer had remarked but perhaps the real problem was thesurprise and secrecy. Had NKF and its CEO been transparent about the pay andother expenses, would the donating public have felt such a betrayal of trust?

Related cases


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Salary secrecy avoids employee conflicts

Case ofNYSE chairman

Richard Grasso, chairman of the New York Stock Exchange, quickly went from folk

hero, for the way he got the exchange running again after the terrorist attacks ofSeptember 11th, to the incarnation of corporate greed when it was revealed that hewould be awarded $140m in accumulated benefits this year.

Mr Grasso tried to stem the tide of outrage by agreeing to forgo another $48m dueto him, but that appeased no one, and he was forced into an ignominious

resignation.

Related cases


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Thank you

Salary Secrecy Ob Ppt

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