There has been an uproar over the variable pay given to Indian Institute of Management (IIM) Rohtak Director Dheeraj Sharma. The Ministry of Education has written a letter to IIM Rohtak and objected to the variable pay of Rs 3.2 crore given to the institute’s director Dheeraj Sharma for 2018-19, 2019-20 and 2020-21. The ministry has sought information from the institute on the method of calculation of variable pay and other details. It is noteworthy that the matter was sent to the ministry on the basis of complaints received by President Draupadi Murmu and in January 2024, the ministry appointed its Internal Audit Wing (IAW) to investigate these complaints. These complaints included allegations of variable pay, irregular supply of mobile phones to faculty and financial irregularities. The audit wing found that the process of variable pay is illegal and the amount paid is much higher than Sharma’s fixed salary.
According to the Indian Express report, the audit wing said in its report that variable pay should be a percentage of a person’s total salary and not more than 100% or 200% of the salary. In this case, the variable pay is more than 200% of the director’s total salary. The ministry has twice sought a response from the institute for information on the calculation process of variable pay in particular. Apart from this, IIM Rohtak has been asked to identify and take action against those officials who were involved in this decision. The ministry has asked the institute to limit the limit of variable pay as well as clarify the plan for recovery of excess payment. It is worth noting that IIM directors also get variable pay along with fixed salary which is based on their performance. Under the IIM Act, the Board of Governors of the institute has the right to take this decision.
The ministry’s first letter was sent in April and the institute responded by saying the variable pay was approved by the Board of Governors and there was no violation. However, the ministry again last month sought specific answers with regard to the audit wing’s report. When IIM Rohtak was asked to respond on the matter, in an email to The Indian Express, IIM Rohtak said the variable pay was paid in accordance with the IIM Act and as per the institute’s rules. It also said the CAG has investigated the matter and found no irregularities.
It is noteworthy that in 2017, a government inquiry is going on against the director of IIM Rohtak for misrepresenting his educational qualifications. Despite objections from the ministry’s representative, the board of the institute approved his candidature for a second term in February 2022. At the same time, the audit wing has raised three major objections to the process of payment of variable pay. First, the approval of variable pay was given before the rules of the institute were notified. Second, financial health was included in the performance criteria but it was increased incorrectly. Third, the variable pay was more than 200% while Sharma is already under government investigation regarding his educational qualifications.
