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High salaries anger public.

Pay stubs showing astronomical salaries being paid to executives of state-owned businesses have been published in the media in recent weeks, prompting a furious outcry.

In the latest example, a pay stub showed the head of the state-owned Bank Refah being paid $800,000 a year or more than 40 times the ostensible maximum allowed under the law.

President Rohani stepped in Sunday, ordering First Vice President Es'haq Jahangiri to review executive salaries. He also said that officials receiving excessive salaries should be fired and required to pay back the excess amount of their salaries.

Majlis Speaker Ali Larijani also weighed in, ordering the Supreme Court to report on what the executives of state-owned firms and organizations are being paid.

The $800,000-a-year salary at Bank Refah was only the latest and largest of several exposes in recent weeks.

The uproar began late in May when a pay stub was posted on the messaging app Telegram for an executive at Central Insurance of Iran, also state-owned, showing he was paid 870 million rials a month ($300,000 a year). His name was blacked out.

Subsequently, more pay stubs were posted, many showing salaries in the tens of thousands of dollars per month plus interest-free loans and overtime pay as well.

Central Insurance responded by releasing two pay stubs for one of its executives, showing base pay of 85 million rials monthly ($29,000 a year). It said the original leaked pay stub did not show a monthly salary, but rather back pay for 85 months. That would mean the unnamed executive was paid $3,500 a year, not $300,000. That claim has not been treated as serious.

Critics are pointing to Article 76 of the Civil Service Law, which states, "No individual in a government post may be paid more than seven times the lowest pay for a civil servant. That minimum pay rate is now 8,120,000 rials per month or $232. That makes the maximum annual salary $19,500 a year.

But executives of state-owned businesses are not civil servants and are not subject to that law.

Economy Minister Ali Tayeb-nia said the excessive salaries were a relic of the administration of President Mahmud Ahmadi-nejad. But the Rohani Administration has been in office almost three years ago, so that explanation rang hollow with many.

It has long been an open secret--dating back years before Ahmadi-nejad took office--that state-owned firms find ways to pay executives more generously on the argument that otherwise talented executives would stay in the private sector. Indeed, not all the published paychecks have indicated outrageous pay scales. Pay stubs for two auto industry executives showed annual salaries of $57,000 and $86,000 a year.

Some of the critics said the real issue was that pay scales were hidden and at the discretion of the top officer of a state-owned firm, leading to favoritism and cronyism. These critics called for a more transparent pay system.

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Publication:Iran Times International (Washington, DC)
Date:Jun 17, 2016
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