The Securities and Exchange Board of India (SEBI) responded to media reports about its work culture and ongoing employee demands. A key issue raised by employees is the demand for a 55% increase in House Rent Allowance (HRA) beyond the 2023 levels. Additionally, some employees raised concerns about SEBI’s Management Information System for tracking performance. In response to protests, a narrative emerged focusing on SEBI’s work culture to gain leverage in securing additional benefits, including automatic promotions without interviews. SEBI clarified that officers are already well-compensated, and the new demands would add substantial costs. SEBI emphasized its efforts in fostering transparency, accountability, and performance-based rewards. The organization believes some employees were misled by external elements to frame work culture issues as bargaining tools. Various SEBI associations condemned the leaking of internal grievances and expressed confidence in the management. SEBI reaffirmed its commitment to ensuring high standards of performance and responsibility, enhancing its employees’ capacity while addressing grievances through internal dialogue.
Securities and Exchange Board of India
Press Release No.20/2024
HRA issues of staff misguided by external elements to target credibility of SEBI and its leadership?
Context:
1. This has reference to the media report of September 04, 2024 on SEBI’s work culture.
2. In the recent past, amongst numerous other benefits, employees were demanding 55% increase in House Rent Allowance (HRA), over the allowance set in 2023. Employees also raised an issue on updation of SEBI’s automated Management Information System for Key Result Areas (KRAs), which had been designed to bring more transparency, fairness and accountability within SEBI. A 15-minute silent protest was held in this context.
3. It is understood that when media reported on this protest as being “only about their working conditions and allowances and perks…” and “nothing about the issues faced by the vast majority of investors and stakeholders …”, a group of employees consciously designed a strategy to change the narrative to frame the issue as relating to the work environment, with an objective to have bargaining power to seek more benefits. Accordingly, a letter focused on “work culture” was crafted and sent to HRD on August 06, 2024.
4. Thereafter, after 7 days, apparently as part of the strategy, a second letter was submitted with a long list of 16 demands, for numerous monetary and non-monetary benefits including increase in HRA. Further, automatic promotions at lower performance ratings without interviews has also been “demanded”.
5. SEBI officers are already well paid, and for entry level officers at Grade A, the cost to company is approximately Rs. 34 Lakhs per annum, which compares extremely favorably even with the corporate sector. The new demands placed by them would amount to an additional CTC of almost Rs. 6 Lakhs per annum.
Work Culture:
6. SEBI is committed to ensuring that it is responsive to the market ecosystem and all its participants, both in terms of speed of approval and facilitating ease of doing business as well as in carrying out timely investigation and enforcement against wrong doing in the market. SEBI employees have been delivering this over many decades and with increasing complexity and scale of the market, they have adopted technology and new processes to continue to deliver to the markets. In line with this commitment, over the last 2-3 years, the following initiatives have been taken by SEBI:
a. Quantified KRAs being set at the start of the year
b. Officer-level and team-level monthly targets set for completion of work
c. Sharp accountability for ageing and pendency from date of first receipt of applications/ reference instead of the date of receipt of the last communication.
d. Monthly MIS for early identification of problem areas for timely resolution of bottle necks, if any.
e. End of year review of performance of each department by a panel of Whole Time Members and Chairperson to facilitate reward and recognition to high performing teams and appropriate bell curve for low performing teams.
f. Promotion policy adapted to include suitability of candidates for core functions of SEBI in assessment criteria in addition to seniority and past performance.
g. Mandatory certifications for employees in line with certifications that are mandatory for market participants.
h. Quantified output based staffing, based on KRAs and transparent rules on creation of vacancies for promotion.
i. Adoption of technology to improve productivity across the organization.
Over the last 2-3 years, SEBI employees have embraced these new initiatives. Ageing of pending matters across every single department has shown significant improvement and the market has felt the responsiveness and timeliness of SEBI’s actions as well.
7. The claims of unprofessional work culture in the letter dated August 06, 2024 are misplaced and seem to stem from instances such as:
a. Under-pitching of processing capability of officers by as low as 1/4th of actual capacity
b. Mis-reporting of status of achievement of KRAs
c. Shuttling of files between departments over a long period to avoid taking decisions
d. “Adjusting” appraisal marks of poorly performing officers to “somehow” make them eligible for promotion.
In such instances, the officers concerned have been held accountable, given firm feedback, and corrective actions taken.
The introduction of the online MIS system was, among other initiatives, aimed at ensuring that deserving employees receive due recognition based on objective performance assessments.
8. It is unfortunate that some elements have attempted to diminish the significant capabilities of SEBI employees by instigating employees to believe that, as “employees of a Regulator” they should not be required to have such high standards of performance and accountability.
External elements:
9. SEBI apprehends that the junior officers have been receiving messages from external elements outside their group, effectively instigating them to …go to media, go to the Ministry, go to Board…, perhaps to serve their own purpose. In fact, the letter of August 06, 2024 was not sent by the SEBI employee associations to the Government (and a section of the media). It was an anonymous email that was sent, and officers and associations have themselves condemned it and communicated the same to HRD through emails.
Extract from mail dated August 10, 2024 from SEA council i.e. SEBI association
“SEA firmly believes in dialogue and consultation with the management in line with the practice followed by SEBI in the last few years.
SEA forcefully condemns the leaking of internal information to media.
It is reiterated that employee grievance is an internal issue which must remain within the organization.
It has full faith in its members and the leadership of the organization that all internal issues could be solved amicably.”
Extract from mail dated August 08, 2024 from SEALS (i.e. SEBI Association of Legal Officers)
“We strongly condemn this and confirm that SEALS does not endorse such demeaning acts by a few unidentified set of staff members. We repose full faith in the organization and its leadership and will continue to do so.”
Extract from mail dated August 09, 2024 from officers of SEBI on Grade A/B/C
“We, officers of SEBI, condemn such email and any media leaks in strongest terms. We are of the firm view that internal grievances should remain within the organization.
It appears that someone is trying to further his / her personal agenda. We disassociate ourselves from any such attempts.
As SEBI officers, we take pride in the reputation of our organization and are committed towards its betterment. We do not support any act that affects the integrity of this organization.”
10. It is interesting to note that while the letter of August 06, 2024 laid great stress on unreasonable targets, when, in response to this feedback, the KRAs were reviewed, the majority of the KRAs were reaffirmed as is by three/four levels of management, and only a few departments saw minor changes to their KRAs.
11. Thus, in summary, it is our belief that SEBI’s junior officers, who were in large numbers, originally aggrieved in respect of HRA allowances, have been misguided, perhaps by external elements:
a. To believe that as “employees of a Regulator”, they should not be held to high standards of performance and accountability even though, they have in fact demonstrated that they are fully capable of delivering to high standards to the market ecosystem.
b. To believe that they are being “underpaid”, even at a CTC of Rs. 34 lakhs per annum and that it would be in their interest to use issues of work culture to bargain for monetary benefits.
c. To believe that they should get automatic promotions.
12. We would not like to speculate on who those external elements may be or what their motives might be.
13. SEBI is committed to serving the complex market ecosystem to a high level of transparency, and responsiveness. Equally it is committed to enhancing the capacity of all its employees and giving them the opportunity to actualize their full potential.
Mumbai
September 04, 2024
