Indian Banks’ Association (IBA) has pleaded inability to meet most of the demands made by the United Forum of Bank Unions (UFBU) that has called for a two-day industry-wide strike on Friday and Saturday, and for three days later on March 11, 12 and 13, before going on an indefinite strike from April 1.
The IBA communicated its position in the matter in a detailed communication to the Chief Labour Commissioner, responding to the 12 demands that the UFBU has raised.
The demands and IBA’s response are as follow:
Pay slip component
Wage revision settlement at 20 per cent hike on pay slip component with adequate loading: Considering the present position of the banking industry and affordability, adequate increase of 12.25 per cent on the pay slip component has been offered. Over and above this, encashment at the time of leave fare concession (LFC) and five days’ additional encashment of leave (payout of approximately 1.37 per cent of the salary) are offered every year on festive seasons. For employees more than 55 years in age, seven days’ annual encashment of leave is offered. In addition to normal encashment of leave available, there would be 150 to 170 additional leave encashments available now to most of the employees during their service period.
A performance-linked incentive (PLI) is offered as under:
*Only if bank generated net profit
For banks which do not generate a net profit but register an increase in operating profit by more than 5 per cent, the PLI will be 10 days which works out to a payout of 2.74 per cent. This will be based on the balance sheet of March 31, 2020. With the better performance of banks, this figure shall certainly improve, year-on-year. In other words, total payout to an employee will be approximately at 16.36 per cent (12.25 per cent + 1.37 per cent + 2.74 per cent) increase in salary.
Five-day banking ruled out, for now
Five-day banking: This is not feasible at this juncture, since concurrence from all stakeholders need to be ensured.
Merger of special allowance with basic pay: The IBA and the unions had arrived at a settlement on May 25, 2015 to revise the salary of employees of public sector banks (PSBs) wherein both parties agreed for introduction of a special allowance. It was agreed that the same will not be considered for superannuation benefits and pension. Accordingly, the bipartite settlement and the joint note were signed by all constituents of the UFBU. After agreeing for not considering the special allowance for superannuation, the UFBU is now demanding merger of the same. Special allowance carries a cost. The demand cannot be conceded to as the cost is not affordable.
Scrap New Pension Scheme (NPS): This is not possible at this stage. The NPS has been agreed upon between the unions and the IBA since April 2010, and stands implemented as of now.
Updation of pension
The pension scheme in public sector banks operates on the principle of funding by the bank from its profit and loss account. It is different from the pension scheme available to Central Government employees where the financial burden is borne by the budgetary allocation. In respect of pension scheme in PSBs, there is no financial burden on the Centre. At the time of retirement of an employee, the bank is expected to ensure that adequate funds are made available for payment of pension/family pension with provision of periodical updation of dearness relief payable. Thus, the financial implications and affordability of the bank is the main factor in effecting improvements in the pension benefits.
Implementation of family pension: The matter has been referred by the IBA to the Government.
Allocation of staff welfare fund based on operating profit: The matter has been referred to the Government for favourable consideration.
Exemption from income tax of retiral benefits: This is out of purview of the IBA.
Uniform definition of business hours
Uniform definition of business hours, lunch hour in branches: Different banks have different business hours according to the geographical location. The change in timings is part of reforms in PSBs under the Ministry of Finance’s Enhanced Access and Service Excellence Programme (EASE) 2.0. The IBA had approved three time slots for customer banking hours all over India from 9 am to 3 pm; 10 am to 4 pm; and 11 am to 5 pm. Therefore, the demand may be taken up at the bank level.
Introduction of leave bank: Not agreeable.
Defined working hours for officers: We understand that there are specified banking hours in branches.
Equal wage for equal work for contract employees/business correspondents: We understand that banks are already following equal pay for equal work. As such, banks ordinarily do not engage any worker on contract basis, and job/work contracts are being undertaken through authorised contractor.
‘DFS going back on its stand’
Speaking to BusinessLine , A Raghavan, Joint Secretary, National Confederation of Bank Employees, and General Secretary, State Banks Staff Union, said that representative of the Department of Financial Services (DFS), Ministry of Finance, had chosen to remain passive while attending the last meeting. It is the DFS which has gone on record saying that it “has been directed to ...request Public Sector Banks to initiate the process of negotiations/next wage revision of employees and conclude it prior the effective date, ie. November 1, 2017”. But now, it appears to have gone back on its stand, Raghavan said.
The UFBU has been demanding and expecting a fair and reasonable offer from the IBA on account of unabated inflation and increasing workload. But it took 20 months for the IBA to improve their offer from 2 per cent to to 12.25 per cent. It knew fully well that the last settlement was signed for a 15 per cent hike. It now says that if leave encashment and PLI components are monetised and added to the 12.25 per cent already mentioned above, the increase works out to 16.36 per cent. But fact is that UFBU has repeatedly clarified and IBA has confirmed during the course of the discussions that whatever component of PLI is agreed upon would be over and above the wage revision increase agreed to at a common level for all banks. So now, linking all these to the 12.25 per cent increase, giving an impression of a higher offer, is unfair and improper, and UFBU does not agree to it.