Money & Banking

Bank union BEFI abstains from signing wage settlement deal

Vinson Kurian Thiruvananthapuram | Updated on July 23, 2020 Published on July 23, 2020

Disagreements crop up over PLI, pension calculation

The Bank Employees Federation of India (BEFI) chose to abstain from signing of the Memorandum of Understanding reached on Wednesday by the United Forum of Bank Unions (UBFU) and the Indian Banks’ Association (IBA) as part of the 11th bipartite wage settlement pending from November 2017.

“We had expressed our dissatisfaction on several issues which we had pointed out in different rounds of negotiation including on Wednesday as also in successive UFBU meetings the last of which was held the same day,” said Debasish Basu Chaudhury, General Secretary, BEFI.

The meeting of the Negotiating Committee took place at the SBI Corporate Centre at Mumbai. Since direct flight connectivity from several cities to Mumbai remained suspended, many of the constituents had expressed desire to participate in the meeting through digital platform like video conferencing, Chaudhury said.

Accordingly, the IBA arranged for video conferencing in some centres. Out of 12 participants from the UFBU, three attended the meeting in person while the rest did so through video conferencing. Chaudhury attended the session on behalf of BEFI through video conferencing from Kolkata.

Salient features of MoU

Salient features of the MoU signed by the IBA and the UFBU included a wage revision from November 1, 2017; annual wage increase in salary and allowances at 15 per cent of the wage bill as on March 31, 2017; new pay scales by merging DA corresponding to 6,352 points; Performance Linked Incentive (PLI) as per a proposed matrix of individual bank’s performance applicable from 2020-2021; five-day encashment (seven days for those of 55 years of age and above) per calendar year besides available facilities of PL encashment; bank’s contribution to the NPS fund at 14 per cent of pay and DA from prospective date of signing the settlement subject to government approval.

Wrangle over PLI

“We had expressed our opposition to the introduction of PLI since beginning. We apprehended that uniformity of wages and service conditions of the employees and officers across all banks covered under a particular settlement will be disturbed once PLI is introduced. The manifestation is already evident during the Covid-19 pandemic, when different banks extended different facilities for their employees, some attracting superannuation benefits,” said Chaudhury.

Even matters pertaining to leave during the pandemic has been left to individual banks disregarding industry level understanding. Even after demand from UFBU to have a bilateral discussion on this, the bankers did not pay any heed, he added.

‘No cogent reason’

At the time of 10th bipartite settlement, when special allowance (starting from 7.75 per cent) was introduced, there was an understanding within UFBU that efforts will be taken to merge this with basic pay during 11th bipartite settlement. Accordingly, this was included in the common charter of demands and discussed in several rounds of negotiation.

“At one point of time, IBA was agreeable to merge a part of the special allowance. We experienced sudden change in its since early this year on the basis of some court rulings since 2016. We do not feel this to be a cogent reason for dropping the issue from negotiation. We suggested that the issue be open for discussion but not accepted by the IBA,” said Chaudhury.

Updation of pension

The issue of five-day week has added a new dimension since the pandemic when utilisation of digital platform as well as work-from-home has become popular. The usage of alternative delivery channels by the clientele across all banks has increased substantially during the last few years.

“We suggested that this too be discussed and initiatives taken to convince the stakeholders. IBA remained non-committal here.”

BEFI understands that updation of pension requires detailed calculation which may require some time. But during the whole three years of negotiation, the IBA has not come up with a positive view. “We suggested inclusion of this in the MoU but the IBA was not interested,” said Chaudhury.

The IBA was sceptical about the load on superannuation cost including provisioning for AS-15. It is a pity that the bankers have written off loans to the tune of ₹4.5 lakh crore in the last four years whereas only 10 per cent of this has been recovered.

“We feel that issues related with pension should not be treated as financial issue, rather it should be taken from a social perspective.”

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Published on July 23, 2020
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