I worked in a software company for 13.5 years and left it now. 7 years back, my salary was Rs.5 lacks per Annum. That time our company had added an extra allowance called ‘skill allowance’ of 1.2 lacks to my salary bringing my total salary to Rs.6.2 lacks. Of course I did not ask for the skill allowance.
During that time our company had introduced an extra allowance called ‘skill allowance’ to retain people having some special skills(ex: SIEBEL skill) who were having high demand in the industry. The company had offered extra ‘skill allowance’ to those employees in addition to their original salaries.
Taking this initiative as an advantage, our IDU head (I report to my project manager, My PM reports to ‘group head’ and GH reports to IDU head. Generally IDU head takes care of a UNIT of 400-500 employees) declared the skill used in our project as a special skill and succeeded in getting ‘skill allowance’ for our skill as well.
I feel that it should not be a special skill. I strongly feel that this new allowance was intended for new skills like SIEBEL, taking this to other skills might not be correct. But there might be some other reasons behind the screen which I might not be aware. But one could argue that the skill used in our project was also a rare skill because the resources having this skill might not be easily available in the market.
One more thing is that our project was very old one and the technologies used in our project were very old. People were not generally interested to work in those old technologies as they might not find brighter opportunities outside our company in those technologies compared to the latest technologies like Java. So Our IDU head might have thought of using this opportunity to boost the morale of the resources in our project by offering skill allowance so that they may not leave our project for some time.
I had asked my PM why I was given this skill allowance. She told me that all the people who fulfilled the following two criteria in our project had been offered the skill allowance.
1st criterion was that the person should have worked for 1 year in our project.
2nd criterion was that the company should be billing the client on higher billing rate than his rate (Suppose as per general company guidelines a TG2 can be billed at level 4. The TG2 person gets skill allowance if the company was billing the client on his behalf at level 5 or level 6)
The client gives some general guidelines to our company regarding the skills, roles and responsibilities of the people for different billing levels. Depending on the expertise and experience of the resources company decides the billing levels of the people. Employee with 0-2 years of experience may be billed to client at level 3 and 3-4 years of experienced person who leads a team of 3-4 people may be billed at level 4 and a PM may be billed at level 5 and so on till level 7.
Our company gives different designations to the resources. The designations are some thing like TG1 for software engineer, TG2 may be for Sr. Software Engineer/Team lead, TG3 may be for Project Manager, TG4 may be for Sr. Project Manager and so on.
The PMs are generally given guidelines regarding who can be billed at what level. Suppose TG1 can be billed at level 3, TG2 can be billed at level 4 and TG3 can be billed at level 5 , TG4 can be billed at level 6 and so on. These are general guidelines but there may be some exceptions like a talented TG2 may be performing the role which calls for billing level 5 , then he can be billed at level 5.
But our PMs/Sr.PMs bill the client for the resources at higher levels than what they deserve by exaggerating their skills on paper. In most of the cases they provide fake details related to experience,roles & responsibilities of the resources.
This skill allowance was given to us for 2 years. After 2 years, our CEO removed this skill allowance concept because of some other issues from the resources who were not offered this allowance. But for the people who got the skill allowance initially, that amount was added to their base salary the year after.
Suppose my salary was 5 lacks +1.2 lacks skill allowance in 2006 and 6.5 lacks base salary +1.2 lacks skill allowance in 2007. In 2008 they have added the skill allowance to my base salary and gave a hike of 30% on top of that. So my base salary became 10 lacks(6.5+1.2=7.7 lacks and 30% hike on that) in 2008. 20% hike was given on top of 10lacks in 2009 and so on.
Now my question is that, can I accept this skill allowance and the hikes I got on the corresponding amount during the later years?
I might have got this skill allowance because I might have been billed at higher rate than what I deserve to the client by our company. And also my IDU head might have managed the company management or HR to add our skill as special skill, it may not be a special skill in reality.
In the Name of Allah, the Most Gracious, the Most Merciful.
As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.
In order for us answer your query, kindly explain how your company deals with the clients. Does your company provide a service to the clients or does it sell off finished products to them. Explain in detail. You may send the clarification to firstname.lastname@example.org.
And Allah Ta’āla Knows Best
Student Darul Iftaa
Checked and Approved by,
Mufti Ebrahim Desai.