IBA, banks sign wage settlement pact

MUMBAI, MARCH 27: The Indian Banks Association (IBA) on Monday signed possibly the last industrywide wage settlement for the banking secto...

MUMBAI, MARCH 27: The Indian Banks Association (IBA) on Monday signed possibly the last industrywide wage settlement for the banking sector. The management body signed the agreement with four bank staff unions including the Shiv Sena controlled Bank Karamchari Sena Mahasangh (BKSM) paving the path for 12.25 per cent wage hike. The last wage agreement lapsed in October end 1997.

However, no arrears will be paid for the period between November 1997 and March 31, 1998. The full impact of the wage hike will be felt from the period starting November 1999 on account of the phasing of payment of arrears. The payment will be 9 per cent between April 1998 and March 31, 1999, 2.25 per cent between April 1999 to October 31, 1999 and 12.25 per cent from November 1 last year onwards.

However, the employees of the three weak banks–Indian Bank, UCO Bank and United Bank of India– may not get the benefit the wage pact as implementation of the wage accord has been re-scheduled in these banks with the matter left to the managements to decide with their respective unions. The banks have been given the option of distributing the wage hike equally over the next three financial years.

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IBA chairman Pannir Selvam hinted at bank-specific negotiations between individual banks and employees in the coming years. "In the future, the distinction between banks will be on the basis of strong banks and weak banks…not public sector, private or foreign banks," the IBA chairman said, adding: "Some banks may possess the capacity of paying the employees more than others".

Reacting strongly against this idea, All India Bank Employees Association (AIbea) general secretary Tarakeshwar Chakraborti said unions are opposed to such a measure. "In the present competitive climate, bank-specific negotiations will be harmful for the sector," he said.

IBA signed the wage revision agreement with four bank workmen unions–Aibea, National Confederation of Bank Employees (NCBE), Indian National Bank Employees Federation (INBEF) and BKSM. Two unions–Bank Employees Federation of India (BEFI) and National Organisation of Bank Workmen (NOBW) are yet to sign the wage accord.

"The two unions have differences on the issue of computerisation and staffdeployment. We are hopeful they will reconsider their position," IBA chairmanSelvam said.

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The banking industry will be burdened with an annual outgo of Rs 817 crore on account on account of the wage hike. IBA had signed the wage pact with officers’ bodies in December last year.