Business & Tourism
After allowance cuts, STO promises higher ‘incentive-based’ pay
The state-owned wholesaler announced a review of its pay structure in the wake of the media reporting that staff allowances and working hours will be reduced on October 21 as a cost-cutting measure.
The behemoth State Trading Organisation has promised higher salaries for its 1,000-strong workforce after changes to its pay structure.
The state-owned wholesaler announced a review of its pay structure in a press release Sunday shortly after local media reported that allowances and working hours will be reduced on October 21 as a cost-cutting measure.
“At present, STO’s pay structure is the same as the civil service and other government institutions and offices that were established to provide services to the public,” the company said.
“But as part of STO’s restructuring, the pay structure will become an incentive-based structure used by modern business companies. As such it has been decided that sales commissions and other allowances for achieving targets will be introduced and that the pay structure will be reformulated.”
The changes will increase take-home pay for employees and improve the quality of services, STO assured.
Sources in the company told newspaper Mihaaru yesterday that some employees could expect pay cuts between MVR3,000 (US$200) to MVR6,000 (US$390) due to the allowance deduction.
Working hours were also changed to 8 am to 2 pm.
A company official told the paper the changes were part of efforts to “improve overall efficiency,” stressing that the allowance cut was a result of shorter working hours. The unnamed official assured basic pay would remain unchanged and that no staff would be laid off.
The STO is the country’s primary wholesaler, responsible for importing the vast majority of basic foodstuffs such as rice, flour, and sugar. The government owns an 82 percent stake in the public limited company.
The STO group, with its subsidiaries, joint ventures and associates, also trades in petroleum, cooking gas, construction materials, medical supplies, pharmaceuticals, electronics, supermarket products and insurance.