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GAIL (INDIA) LIMITED Corporate HR Department

OFFICE ORDER

No.CO/HR/PoljWR-13

30th April 2009

Subject: Revision of pay scales for Board level and below Board level executives of GAIL w.e.f. 1.1.2007

1. GAIL Management is pleased to announce the revision in pay scales for Board level and below Board level executives w.eJ. 1.1.2007, in terms of the Presidential Directives received from the Ministry of Petroleum and Natural Gas vide their letter No.ll011j4/09-GP, dated 24th April 2009 based on the guidelines issued by the Department of Public Enterprises (DPE) vide their O.M.s No.2j70j2008-DPE (WC) dated 26th November 2008, NO.2/70/2008-DPE (WC)-GL-IVj09 dated 9th February 2009 and No.2/70/2008-DPE (WC)-GL-VII/09 dated 2nd April 2009.

2. Accordingly, Pay Scales, Dearness Allowance, etc. in respect of Board level and below Board level executives of GAIL (India) limited will stand revised w.eJ. 1.1.2007 as under:

2.1 Pay Scales

Following shall be the Pay Scales for Board and below Board level executives w.eJ. 1.1.2007 :

Grade Pay Scales
CMD 80000-125000
Director 75000-100000
E-9 62000-80000
E-8 51300-73000
E-6 43200-66000
E-5 36600-62000
E-4 32900-58000
E-3 29100-54500
E-2 24900-50500
E-1 20600-46500
E-O 16400-40500 Note

Revised pay scales for existing grades £-6A and £-7 shall be notified after the decision is taken on intermediary pay scales in terms of Presidential Directives, for which a reference is being made through MoP&NG to DPE. Meanwhile, existing incumbents will be aI/owed fitment benefit in terms of Para - 2.3 be/ow.

2.2 Coverage

All executives who are on the rolls of the Company as on date and those superannuated on or after 1.1.2007.

2.3 Fitment Benefit

2.3.1 A uniform fitment benefit @30%, on basic pay plus DA @78.2% as on 1.1.2007, would be provided to all executives. The aggregate amount would be rounded off to the next ten rupees and pay fixed in the revised scale.

2.3.2 Executives eppointed on or after 1.1.2007 shall be deemed to have been appolnted in the revised scales of pay.

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2.3.3 Executives appointed on or after 1.1.2007 at the minimum of the pre-revised pay scales shall be deemed to have been appointed at the minimum of the revised scales of pay.

2.3.4 Executives appointed on or after 1.1.2007 with additional increments in the prerevised pay scales will be granted equal number of increments in the revised pay scales subject to the condition that the pay so arrived, will be restricted to the revised pay of an executive in the same grade who was on the rolls of the company as on 31.12.2006 and drawing the same pre-revised pay. In respect of such executives who have joined from other PSUs and whose pay will get revised in the earlier organisation, they shall be entitled to normal Pay protection as per rules.

2.3.5 The pay in respect of employees, who were promoted/ appointed on or after 1.1.2007 from non-executive grade to the executive grade, shall be fixed provisionally at the minimum of the corresponding scale in the executive category. On implementation of revised pay scales of non-executive categories which is also due w.e.f. 1.1.2007, pay of such employees will accordingly be re-fixed in the revised pay scales of executives.

2.3.6 Wherever extra ordinary increment(s) and/or increase in the pay in respect of executives have been granted with retrospective effect, which affects the revision of pay as on 1.1.2007, such increment and/or increase in pay will be ignored for the purpose of fitment/ pay revision.

2.3.7 Where executives drawing pay at two or more consecutive stages in an existinq scale get bunched, then, for every two stages so bunched, benefit of one increment shall be given.

2.3.8 In case of executives in E-6A and E-7 grades, revised pay shall be fixed by grant of fitment benefit as above, subject to a provisional maximum of Rs.68500/- and Rs. 71000/ - I respectively.

2.4 Annual increment

Annual increment will be @3% of revised basic pay and will be rounded off to the next multiple of Rs.10/-.

2.5 Stagnation increment

The rate of stagnation increment will be @3% of the revised basic pay. Executives will be allowed to draw maximum three stagnation increments, one after every two years, upon reaching the maximum of the revised pay scale provided the executive gets a performance rating of "Good" or above. Pay of executive after grant of stagnation increment will be rounded off to the next multiple of Rs.10/-.

2.6 Pay Fixation on Promotion

One notional increment equal to the increment being drawn by the executive in the pay scale, before such promotion would be granted and pay fixed in the promoted pay scale and rounded off to the next multiple of Rs.10/-.

2.7 Dearness Allowance

2.7.1 100% DA neutralization will be adopted for all the executives, who are on IDA pattern of scales of pay, w.e.f. 1.1.2007. Thus, DA as on 1.1.2007 will become zero linked to All India Consumer Price Index (AICPI) 2001 == 100, which is 126.33 as on 1.1.2007.

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2.7.2 The periodicity of adjustment will be once in three months, as per the existing practice.

2.7.3 The quarterly DA payable from 1.1.2007 as per new DA scheme shall be as given below:

w.e.f. Rate of Dearness Allowance
1.1.2007 0.0%
1.4.2007 0.8%
1.7.2007 1.3%
1.10.2007 4.2%
1.1.2008 5.S%
1.4.200S 6.3%
1.7.200S 9.2%
1.10.200S 12.9%
1.1.2009 16.6%
1.4.2009 16.9% 2.8 House Rent Allowance (HRA)

2.8.1 Payment of HRA will be at the following rates w.e.f. 26.11.2008:

Cities with population RatesofHRA
50 lakh and above 30% of Basic Pay
5 to 50 lakh 20% of Basic Pay
Less than 5 lakh 10% of Basic Pay 2.8.2 In terms of the above, classification of different locations shall be examined and notified separately. Pending the same, existing quantum of HRA admissible to an executive as on 25.11.2008 shall continue.

2.8.3 In case the actual amount of HRA as per prescribed rate is less than the actual amount of HRA drawn as on 25.11.2008 in case of a particular officer, the difference would be allowed to be drawn by the officer as "Personal Allowance" until the difference is eliminated in course of time subject to the condition that the difference will be subsumed within the overall limit prescribed for perquisites and allowances prescribed under the DPE guidelines, as referred above.

2.9 Leased accommodation

2.9.1 Entitlement of executives for lease facility, as also for House rent Recovery (HRR) in the revised pay structure shall be notified separately.

2.9.2 Pending the same, lease entitlement of individual executives as on 25.11.2008 shall continue unchanged.

2.10 City Compensatory Allowance (CCA) Payment of CCA stands dispensed with.

2.11 Pay etc. of GAIL executives on deputation I transfer

Executives, who are brought into holding companies from subsidiary companies or viceversa on deputation/ transfer, will continue to draw their basic pay as drawn in the parent organisation. They will, however, be entitled to draw the allowances and variable pay/ performance related pay as applicable to the borrowing organization.

2.12 Pay etc. of Government officer on deputation to GAIL

Government officers, who are on deputation to GAIL, will continue to draw the salary as per their entitlement in the parent department. Only those, who come on permanent absorption basis, will be entitled to GAIL pay scales, perks and benefits.

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2.13 Gratuity

The ceiling of gratuity for executives in GAIL would be raised to Rs.l0 lakhs w.e.f. 1.1.2007.

2.14 Superannuation benefits

The ceiling for superannuation benefits, which may include Provident Fund, Gratuity, Pension and Post Retirement Medical Scheme (PRMS), shall be 30% of Basic Pay plus DA provided that any superannuation benefit, in terms of the same, will be under a "defined contribution scheme" and not under a "defined benefit scheme". Schematic changes in terms of the above mentioned DPE guidelines shall be examined and notified separately.

2.15 PF contribution

Deduction of contribution towards Provident Fund shall be made on the revised pay w.e.f. 1.1.2007.

2.16 Staff Car facility

The Staff Car facility shall be provided to CMOs and Directors as per notified entitlement. EDs/ GMs heading the projects of GAIL may also be provided with Staff Car facility. Specifics with regard to projects/ implementation shall be notified separately.

2.17 Performance Related Pay CPRP), Long-term incentives, introduction of Cost to Company CCTC) and adoption of Cafeteria Approach

The above issues will be examined and notified separately.

2.18 Other perks and allowances

2.18.1 In terms of OPE guidelines, as referred above, perks and allowances shall be considered for revision from 26.11.2008 subject to a maximum ceiling of 50% of revised basic pay.

2.18.2 Accordingly, the quantum/ entitlement of benefits, perks, allowances and deductions, as allowed to executives as on 25.11.2008, shall remain unchanged till further orders.

3. General

3.1 The revision of pay structure of executives w.e.f. 1.1.2007 shall be implemented in GAIL along with the salary of April 2009. Arrears/ recoveries, as applicable in respect of concerned executives for the period 1.1.2007 to 31.3.2009, against relevant heads shall be disbursed in due course taking into account other aspects under consideration.

3.2 The amount of adhoc adjustable advance already granted to executives against pay revision from 1.1.2007 till 31.3.2009 shall be adjusted against the arrears accruing on account of pay revision.

3.3 The excess payment, wrong payments, arithmetical and system errors, in calculation of the arrears shall be subject to corrections, adjustments and recoveries.

3.4 Any other recovery due from an executive to the Company, will also be fully adjusted against pay revision arrears due to him/ her, in terms of the approval of Competent Authority.

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4. All other aspects of pay and benefit administration shall be notified later.

5. All issues pertaining to pay revision of executives requiring interpretation, clarifications shall be referred to Corporate HR Department.

6. Hindi version follows.

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Executive Director (HR)

Distribution

1. CMD and officiating Director (HR)

2. Director (Finance)! Director (Projects)! Director (8D)! Director (Marketing)! CVO

3. HODs at Corporate Office

4. OICs of Work Centres! Zonal Offices

5. General Manager (6IS), NOIDA

6. HR and F&A Incharges of Work Centres! Zonal Offices

7. All Executives (through e-mail)

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