UTI AMC on Friday dismissed reports that its former chief M Damodaran had awarded 'undue favour' to some executives, saying it has initiated a new performance-based compensation package in line with the recommendations of an HR consultant.

"Based on the recommendations of an HR consultant and as approved by board the new compensation structure across UTI AMC was implemented," a spokeperson of UTI AMC, the country's biggest mutual fund, said.

Since erstwhile UTI's pay package was not in tune with the market, he said the Board decided to hire an HR consultant to suggest measures to 'attract, retain and reward' skills.

"Compensation structure was sought to be linked with the functional role of the employee and the value one would add to the business," he said.

The new compensation structure implemented now is linked to cost to company as followed by other private sector mutual funds that includes the cash equivalent of all the facilities and benefits hitherto available to an executive such as housing, conveyance, medical, leave fare concession, books and periodicals, telephone, retirement benefits, etc.

Dismissing the report that Damodaran had awarded 'undue favour' to some executives, the spokesperson said, "The new HR policies of UTI AMC is an outcome of an effort of nearly two years of extensive study, discussion and effort put in by the board of AMC and the HR consultancy firm."

The process of revamping pay structure was on well before Damodaram demitted office a few weeks ago, he said.

In fact, he said the new pay package is only a part of the elaborate HR initiatives taken by UTI AMC in various areas which include manpower planning, job evaluation, benchmarking, promotion policy, variable pay, balanced scorecard.

The HR exercise covers all officer staff of UTI AMC and is not restricted to the select set of officers.