Dear Employer,
Thank you very much for giving me this feeling of not receiving the paycheck on time.........
for the 4th time in the last fifteen months. Apart from other things, you made me realize that getting your salary on time is not something that one should take for granted at all.
I mean seriously you make me feel that I am working in a startup with all its associated uncertainties. Giving the startup fascination in India these days, I would love to "feel" that I am part of one but of course there are better ways of making me feel so. Talking about startups, you guys can give the best of that breed a run for their money when it comes to creativity. The manner in which you come up with different reasons, literally every time there is a salary delay, is nothing but a stroke of genius. Following are some gems - "Administrative delays", "Unavoidable reasons", "Technical issues", "New process being set up". You do not inform us in advance and when we protest, you miss the forest for the bush and ask if it is fine if we are informed in advance. You are audacious enough to suggest me to "postpone" my liabilities. I understood the importance of a contingency plan in life only when you suggested that one should have it in place to tide over emergencies - convenient salary delays being one of them. All for some out-of-the-box thinking !!
Being from a risk management world, let me elaborate on the implications of a delay using some relevant terminology and concepts:
Market risk : As an employer, it is a big risk for you if you don't pay us on time.You would become the least preferred employer in the market. Well, as far as the investing community is concerned, Thank God you are not publicly listed.... else even God could'nt have been able to save their portfolios.
Reputational risk : An organisation's reputation is tarnished if it does'nt pay its employees on time.... that too with a consistency (Consistency is the keyword here, you have displayed this quality remarkably well). A big reputational risk, assuming you care a damn about it !!
Credit risk : Employees themselves have a number of payments to make (rent / domestic helpers /EMIs et al). Since you don't pay us on time, we default on downstream payments (thereby lowering our credit ratings). This replicates further downstream. I mean you are giving rise to a desi, scaled down version of the credit crisis :) You would surely want to be placed in the bylanes of history for better reasons, is'nt it ? If there was a market for credit default swaps with the reference entity being myself / my colleagues, I swear I would have bet heavily on it.
Counterparty risk : We fulfill our side of the employment agreeement in terms of providing intellectual capital and delivering on assignments. When we don't receive the emoluments in return from you (i.e the counterparty), it is a huge risk that we face.
Operational risk : As highlighted to you earlier in discussions, employees have to spend productive time in office guessing / speculating on the salary issues. Consequently, the client faces the operational risk of low productivity and hence low output.
In the discussions that us employees have, we have also explored the ways in which you could be possibly putting our salary monies to work. You say that there are around 140 contractors working for the client. Assuming an average salary of 10lakhs (and I am being conservative here), you have a total sum of 14 crores at your disposal. Let's say, you invest it in a SBI 7-day fixed deposit which gives you an interest rate of 4.25%. If you keep the funds invested for 4 days (average delay experienced by us over the last 1 year) you could make around 65 thousand. You could also be lending in the informal lending market or better still, you could be day trading and what not !! Phew !! Unable to think of more options...
There are a few good things too that have come out of these incidents - the laughs that we have had (and continue to have), creative thinking (during our discussions), this article (and the laughs that it might hopefully generate) etc.
I started writing this after the last delay (1st week of Sep). I then left it midway and lost focus. Guess what !! There was another delay (alright... yet another) for Oct as well. It provided me another shot of enthusiasm to finish the piece. This brings me to the end of this write up but the suspense though continues until the next paytime.... Will we get it on time or will we not ?!!
Thank you very much for giving me this feeling of not receiving the paycheck on time.........
for the 4th time in the last fifteen months. Apart from other things, you made me realize that getting your salary on time is not something that one should take for granted at all.
I mean seriously you make me feel that I am working in a startup with all its associated uncertainties. Giving the startup fascination in India these days, I would love to "feel" that I am part of one but of course there are better ways of making me feel so. Talking about startups, you guys can give the best of that breed a run for their money when it comes to creativity. The manner in which you come up with different reasons, literally every time there is a salary delay, is nothing but a stroke of genius. Following are some gems - "Administrative delays", "Unavoidable reasons", "Technical issues", "New process being set up". You do not inform us in advance and when we protest, you miss the forest for the bush and ask if it is fine if we are informed in advance. You are audacious enough to suggest me to "postpone" my liabilities. I understood the importance of a contingency plan in life only when you suggested that one should have it in place to tide over emergencies - convenient salary delays being one of them. All for some out-of-the-box thinking !!
Being from a risk management world, let me elaborate on the implications of a delay using some relevant terminology and concepts:
Market risk : As an employer, it is a big risk for you if you don't pay us on time.You would become the least preferred employer in the market. Well, as far as the investing community is concerned, Thank God you are not publicly listed.... else even God could'nt have been able to save their portfolios.
Reputational risk : An organisation's reputation is tarnished if it does'nt pay its employees on time.... that too with a consistency (Consistency is the keyword here, you have displayed this quality remarkably well). A big reputational risk, assuming you care a damn about it !!
Credit risk : Employees themselves have a number of payments to make (rent / domestic helpers /EMIs et al). Since you don't pay us on time, we default on downstream payments (thereby lowering our credit ratings). This replicates further downstream. I mean you are giving rise to a desi, scaled down version of the credit crisis :) You would surely want to be placed in the bylanes of history for better reasons, is'nt it ? If there was a market for credit default swaps with the reference entity being myself / my colleagues, I swear I would have bet heavily on it.
Counterparty risk : We fulfill our side of the employment agreeement in terms of providing intellectual capital and delivering on assignments. When we don't receive the emoluments in return from you (i.e the counterparty), it is a huge risk that we face.
Operational risk : As highlighted to you earlier in discussions, employees have to spend productive time in office guessing / speculating on the salary issues. Consequently, the client faces the operational risk of low productivity and hence low output.
In the discussions that us employees have, we have also explored the ways in which you could be possibly putting our salary monies to work. You say that there are around 140 contractors working for the client. Assuming an average salary of 10lakhs (and I am being conservative here), you have a total sum of 14 crores at your disposal. Let's say, you invest it in a SBI 7-day fixed deposit which gives you an interest rate of 4.25%. If you keep the funds invested for 4 days (average delay experienced by us over the last 1 year) you could make around 65 thousand. You could also be lending in the informal lending market or better still, you could be day trading and what not !! Phew !! Unable to think of more options...
There are a few good things too that have come out of these incidents - the laughs that we have had (and continue to have), creative thinking (during our discussions), this article (and the laughs that it might hopefully generate) etc.
I started writing this after the last delay (1st week of Sep). I then left it midway and lost focus. Guess what !! There was another delay (alright... yet another) for Oct as well. It provided me another shot of enthusiasm to finish the piece. This brings me to the end of this write up but the suspense though continues until the next paytime.... Will we get it on time or will we not ?!!
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