News on Wage Settlement in Banking Industry

             Bank Wage Settlement: IBA and UFBU

agree on 401 Slab DA merger

By: Manish, Place: Mumbai,  Update:14 Aug 2013

Bank Employees Wage revision is going in a cordial environment which was observed in meeting of the Negotiating Committee of IBA, Indian Bankers Association (Govt of India Negotiating Body) with the representatives of Bank Officers’ Associations and Workmen Unions was held on 12.08.2013 at IBA office in Mumbai. It is learnt that the positive attitude of IBA was based on Finance Minister Mr P. Chidambaram’s assurance of early wage revision last day to UFBU delegation. As per our sources, IBA and UFBU are near negotiations and are agree on 90% issues. IBA agreed that the new wage settlement would be effective from 1st November, 2012, i.e. the date from which the 10th Bipartite Settlement is due.   As per UFBU sources, IBA agreed and conceded to merge Dearness Allowance upto 4440 Consumer Price Index i.e. 401 slabs and construct new pay scales accordingly. This outcome was came out in bipartite talks took place on 12.08.2013 in Mumbai between IBA and UFBU on 10th wage revision.  IBA was represented by their Negotiating Committee led by its Chairman Shri T M Bhasin. UFBU was represented by all nine constituent unions of UFBU, United Forum of Bank Unions. Bipartite meeting was continued till evening and in the day-long discussions held, satisfactory decisions on some of the important issues could be arrived at.  Continuing the discussions of the last round of talks held on 7th June, 2013, UFBU emphasised the need for IBA to expedite and conclude the settlement in a time bound manner.  UFBU also asked them to react and respond to the issues like date of effect for commencement of the revised wages, consumer price index point up-to which Dearness Allowance is to be merged with basic pay for construction of revised pay scales, quantum of wage revision, etc.  Settlement’s Date of Effect In response, the IBA agreed that the new wage settlement would be effective from 1st November, 2012, i.e. the date from which the 10th Bipartite Settlement is due.   Merger of DA for Constructing Revised Pay Scales: 401 Slabs IBA explained their constraints to consider merger of Dearness Allowance at higher index points. After prolonged discussions and on the insistence of the UFBU for merger of D.A at a higher level to enable construction of Pay Scales in a reasonable manner looking to the Pay Scales of employees and officers in comparable sectors, IBA agreed and conceded to merge Dearness Allowance upto 4440 Consumer Price Index i.e. 401 slabs and construct new pay scales accordingly. Increase in Wage Load On the offer of the wage load increase, IBA wanted to study the cost impact of the merger before responding.  However, the UFBU reiterated its demand that the offer should be exclusive of superannuation cost and improvements in other welfare measures.  IBA indicated that the same would be kept in mind by them. In 9th Wage settlement bank employees were get increase of only 17.50% salary due to pension load factor, where central govt employees got 60% increase in 6th pay commission. After 9th wage revision bank employees’ salary is 40% less than compared sector and PSUs. Reimbursement of Hospitalisation Expenses:  On UFBU demand for 100% reimbursement of hospitalisation expenses incurred by the employees/officers for self and eligible family members, IBA offered introduction of Mediclaim policy facility under which hospitalisation expenses would be reimbursed by the insurance company upto Rs. 2 lacs for sub-staff, Rs. 3 lacs for clerical staff and Rs. 4 lacs for officers per year. Looking to the various implications of switching over to the new scheme and the need to examine the pros and cons of the scheme, we said that a detailed study is required on the contents of the scheme offered before responding. Management Issues:  The management’s issues like introduction of cost to company method, Fixed Pay and Variable Pay concept were discussed and UFBU has given its strong views against the same.  However, the matter remained inconclusive. Compassionate Ground Appointment Scheme on Central Govt Pattern Bank employees another vital issue, much dearer to all the bank employees, which is relentlessly being pursued by the UFBU is restoration of compassionate appointments in the Banking Industry. IBA informed UFBU in this meeting that its recommendations for introduction of compassionate appointment scheme on similar lines prevailing in Central Government for its employees has been sent to Ministry of Finance, Govt. of India for its approval. No doubt, it is an important step in the direction of restoring compassionate appointments in the Banking Industry. IBA and UFBU were found on conclusion on two vital issues i.e. date of effect and merger of dearness allowance.   As per one participant NUBE General Secretary Mr L.Balasubramanian, the IBA was gracious enough to consider the demand as below: -The new wage settlement would be effective from 1st November, 2012, i.e. the date from which the 10th Bipartite Settlement is due. -IBA agreed and conceded to merge Dearness Allowance upto 4440 Consumer Price Index i.e. 401) and construct new pay scales accordingly. - Recommendations for introduction of compassionate appointment scheme on similar lines prevailing in Central Government for its employees has been sent to Ministry of Finance, Govt. of India for its approval. As per our sources the RBI employees are also badly affected on salary front compared to central govt employees. RBI employees’ salary is almost based on bank employees and negotiation takes place after bank wage settlement every time. As per banking industry sources the SBI is always giving 10% additional benefit to their employees than other PSU banks and RBI employees getting 20% additional benefits by way of facilities. But after 6th pay commission the salary of SBI and RBI employees are also less than central govt employees. It is learnt that in 10th wage revision all sector of industry is in mood of getting salary at par to central govt employees which is also indicated in this talk. Banking Industry experts are hopeful of bank wage revision before 2014 election with minimum 35% total increase. Wage Settlement next meeting of IBA and UFBU is expected in last week of August 2013.