The Hindu Business Line : `Collective bargaining key to protect labour interests'

COLLECTIVE bargaining will continue to be the ideal tool for protecting labour interests in the banking sector despite trade unions having diluted much of their posturing in recent times.

"Today, the unions have taken a pragmatic stand. They appreciate need for modernising workplaces in this era of competition. There's no ideological opposition on several counts any more. Even the Left has had to effect some change in postures with regard to the changing environs," says Mr Shantha Raju, General Secretary, All India Bank Officers Confederation (AIBOC).

Dating back to early 1960s and instrumental in cementing the bipartite relationship in the industry, collective bargaining will continue to be relevant but reflective of the changed times, Mr Raju told Business Line here. For instance, unlike at no time in the past, officer and employee unions sat together to finalise the latest industry-level wage settlement.

The industry now employs some 10 lakh employees and officers. Bank-level negotiations for wage settlement, which have gained some votaries in recent times, can be time-consuming, messy and even discriminatory at times. "Now, it's acknowledged by everybody that whatever the processes involved, it's better to have one agency each on either side of the table representing the management and employees.

"I don't say there is a total shift in stance of employees but there is moderation in the extreme posturing. The unions realise that if they don't change by adopting technology, they will be upstaged by organisations willing to go the distance. Ultimately what matters is how you are going to deliver. Why should employees suffer only because they lack the technology?"

Collective bargaining and bipartite negotiations have come to be hotly debated, but only from the point of view of customer service and efficiency.

"Now, I can talk as a player in the banking industry. After the reform process was initiated in 1991, the pubic sector banks have been able to blunt the edge of much of the criticism raised against it by the pro-privatisation lobby."

The first criticism was that the banking industry was carrying a huge load of non-performing assets when compared with peers internationally. But Indian norms were based on the reporting system run by the operating staff. If the latter found that a particular advance was not recoverable, it would come to be treated as a bad debt or a protested bills account.

When the first phase of Basle norms were introduced, doubts were aired whether public sector banks would be able to withstand the pressure. "Today we've proved our critics wrong by successfully dealing with the situation. We've been able to complete implementation of Basel I norms. We are now looking to implementing Base II as well.

"This, at a time when all the western nations, including the US and the UK, have sought more time to implement Basel II. But the Reserve Bank insists India must go ahead with Basel II right away. We've been more than cooperative and have expressed our willingness to comply. Capital adequacy norms have mostly been met and NPAs brought down to around three per cent on an average. Some banks have even managed zero per cent NPAs.

The second criticism levelled against public sector banks was on the twin issue of customer service and induction of technology. "But I can say with a certain amount of confidence that today that we are able to meet the standards prescribed by the Reserve Bank for technology induction. Most of the banks already have, or are going in for core banking solutions.

"The third criticism was customer service. Now, in an industry where we serve with millions of our customers, we have no chance to pick and choose one. In fact it is the right of the customer to demand service. The only comparable service in size and scale is that delivered by post offices in the country. I don't think our numbers have any parallel even globally," Mr Raju said.

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