Visakhapatnam

Visakhapatnam Ltd CAST STUDY  solution

Read the following case and answer the questions given at the end :

 A financial institution has just decided to open a branch at Bhimunipatnam, an exclusive resort located about 30 kms from Visakhapatnam, a large city. There is no bank at present in Bhimunipatnam. The financial institutions is anxious to determine the appropriate wage structure for the clerical staff it expects to hire. Clerks in the city office at Visakhapatnam receive a starting salary of Rs. 5,000 per month. As a matter of company policy these salary rates have been set at midpoint of the range for financial institutions in Visakhapatnam. A survey of local establishments at Bhimunipatnam indicates that the 'going rate' for qualified clerical personnel varies between Rs. 6,500 to Rs. 6,800 a month. The higher rate at Bhimunipatnam may be attributed, in part, to the substantially higher cost of living in this resort town, the limited number of young people seeking employment, and the fact that there are no other financial institutions in Bhimunipatnam. Banks in Visakhapatnam have traditionally paid lower MS-salaries than other establishments, on the ground that banks offer better working conditions and higher prestige.

 Questions :

 (a) Identify the main features of the case in general.

 (b) What factors should be considered while fixing different pay rates.

(c) What would be the legal implications of two different salary structures in the same region ?