Pay hike of 15% to eight lakh employees includes arrears since November 2012; banks to remain closed on alternate Saturdays after employee unions deal with Indian Banks Association
Bank unions have called off their indefinite strike after the Indian Banks Association (IBA) agreed for a 15% rise in wages. Banks will also henceforth remain closed on alternate Saturdays.
Forty-six banks including all public sector banks, old private sector banks and all foreign banks. The new generation private sector banks including ICICI Bank and HDFC Bank are not part of the agreement.
The banks will have to fork out Rs 4,725 crore annually after the wage revisions. Eight lakh employees from 27 public sector banks will benefit from the wage settlement, which will be effective from November 1, 2012.
At a meeting in Mumbai on Tuesday, representative of the bank management and the representatives of workmen and officers association agreed for a 15% wage hike. Every second and fourth Saturdays of the month will remain closed while the other two Saturdays will have full-day working. IBA has also agreed for a two Saturday holiday with retrospective effect from November 2012. The arrears for the Saturdays worked will also paid with retrospective effect from November 2012.
Harvinder Singh, general secretary of All India Bank Officers Confederation, told dna, “The wage settlement was not really a compromise. The management and the employees have compromised on some of their demands to that a good wage settlement is in place. Saturday remaining closed is also a cost to the bank. We will also get arrears for Saturdays worked 2012 with retrospective effect.”
The bank unions had threatened to go on four-day nation-wide strike from February 25 demanding 19% hike in wages. The wage hike was due from November 2012.
Union leaders met the representatives of IBA, the bankers’ lobby, on Friday for conciliatory talks to resolve the pending wage issues in the presence of chief labour commissioner P P Mitra. The last round of negotiations between the unions and the IBA, held on February 3, failed after the IBA offered a 13% hike compared with 12.5% offered earlier. But this was still much lower than the 19.5% demanded by the unions.
While the IBA started the wage negotiations it had proposed a meagre pay hike of 5%, unions demanded a steep 25%. The first few rounds of negotiations were stalled in 2014 and employees stayed off work several times. In 2010, the last time wages were revised, both sides settled on a hike of 17.5%. The last hike, however, included pension and gratuity, while this time the increase is being calculated only on the payslip component.
Bank wages are revised every five years. The present round of wage hike is pending since November 2012. The finance minister was aware of the pending wage hike issue, but preferred not to quantify the percentage increase in wages that should be agreed upon. Unions say their demands are genuine and if banks take care of their operational costs then it will be easy to manage the wage revisions.
Finance minister Arun Jaitley on Saturday had appealed to bank employee unions to call off their proposed four-day strike.
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