Bank unions plan indefinite stir

Our Mumbai Bureau adds: The Indian Banks’ Association (IBA) is, however, refusing to alter its stance and sticking to its original offer of an 8 per cent wage hike for one lakh-and-odd bank employees at the seventh bipartite settlement. The last wage settlement had expired in November 1997.

The unions had earlier demanded a 25 per cent wage hike. At the sixth five-year wagesettlement, bank employees and officers had got a 10.5 per cent hike.

Keeping in view the "present scenario and the banks’ paying capacity" IBA made a final offer of wage revision equal to 8 per cent increase in establishment expenses as on March 31, 1997, to be implemented prospectively. IBA is unlikely to dilute its stance as some of the weak banks have hinted at opting out of the wage settlement as they cannot afford a higher wage revision. At least three banks — Uco, UBI and Indian Bank — are ready to withdraw the mandate given to the IBA to broker the wage deal on their behalf.

The 8 per cent hike in employees’ wage, if implemented, will impose an annual burden of about Rs 1,000 crore on the banking industry. At present, the banking industry spends Rs 11,700 crore to meet the wage expenses of staff and officers annually. IBA secretary MN Dandekar justified the proposed 8 per cent wage hike saying on a relatively higher base the quantum of hike would be a decent one, particularly in the context ofthe present economic scenario and banks’ capacity to pay.