Pakistan Institute of Development Economics


A warm send-off

Publication Year : 2021
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CAN we make it easier to lay off a non-performing public servant? If performing employees cannot be promoted to higher ranks, can we give them a warm send-off, with some retirement benefits, well before they turn 60? The explicit and implicit, almost absolute, job security available to public servants is at the root of non-performance. Why should someone who does not risk losing their job for non-performance put in the effort to perform?Firing a non-performer from a government job is difficult but not impossible. The problem is that public entities and its bosses do not use the options available to them. To begin with, a boss has to write about non-performance or subpar performance in the non-performer’s Annual Confidential Report. However, bosses rarely allude to subpar or non-performance and the poor work attitude of their subordinates in ACRs. This is because an employee’s non-performance causes loss to the organisation, it is not the personal loss of the boss concerned; there are also social pressures and maybe some intimidation involved.To bring about a change, goals may be assigned to bosses that they can achieve only with their subordinates’ assistance, so that non-performance by the latter will inflict a personal loss upon the bosses. Caveats notwithstanding, this will help develop the motivation and courage to write an adverse ACR.One annual salary increment (called ‘normal increment’) is the norm in public service. It is so well established that employees consider it their fundamental right. Under the rules, however, the increment can be withheld if performance is unsatisfactory. Public entities do not even use this option to warn a non-performer. The prerequisite for increment stoppage would of course be an adverse ACR, which the bosses refrain from writing.Non-performance spreads like a virus.Not only non- but also subpar performance must be tackled early on. ‘X’ does not perform and gets away with it; this encourages ‘Y’ to act likewise — non-performance spreads like a virus. Secondly, though a subpar performer does not get fired, he/she may not be promoted or be deprived of one-off opportunities like trainings, etc. They would then be quick to blame this on nepotism. This perceived nepotism leads to an even greater degree of non-performance. A vicious and widening cycle — subpar performance, promotion denial, perceived nepotism, further non-performance — sets in. To avoid this, one must tackle subpar performance early on.Most jobs have a pyramid like structure — more people in junior positions and less in senior ones. There are employees who are good workers but cannot make it to senior positions due to lack of space towards the top. The problem should be tackled because non-promotion kills motivation and lack of motivation kills workers’ productivity.To handle this situation, let’s take a cue from the armed forces. If a batch of 100 persons join the army together as 2nd lieutenant, only a handful of them, perhaps three to five, make it to the top rank of lieutenant general. The rest retire in the lower ranks, and much before attaining the age of 60. A colonel not promoted to the rank of brigadier would perhaps retire in his late 40s or early 50s.Except for the armed forces, all public entities retain employees till the age of 60, including those who are good workers but cannot make it to higher ranks due to lack of space towards the top of the pyramid. Such ‘retained-but-not-promoted’ employees often enter the same vicious circle of ‘perceived nepotism, non-performance’ and then spread the virus of non-performance. Even otherwise, with no more promotions in sight and job security almost absolute, little motivation to perform remains. In such situations, it is better to give a warm send-off rather than retain a demotivated employee who is a potential carrier of the non-performance virus.Retiring people in their 40s and 50s would mean paying pensions earlier and for longer time periods. This would increase the government’s pension burden. Pakistan Institute of Development Economics research suggests that the pension burden is already unsustainable and, sooner or later, the country has to move to a fully funded pension system. Under this system, employees themselves contribute monthly towards their pensions, the contributions are invested and upon retirement the employees gets their contributions plus the return on investments. If we move to a fully funded pension system, early retirement should not be a cause of concern from the pension perspective.What will the young retirees do for a livelihood? With a vibrant private sector, finding a job for an experienced, professionally educated person should not be too difficult. A career planning mechanism, which makes the expected early retirement known well in advance, will allow the potential retiree to plan his/her exit quite well.