In July, it was announced that the negotiations between bank employees’ unions and banks on wage revision would begin on 28 July. At the time, the All India Banks Employees’ Association (AIBEA) had revealed that the United Forum of Bank Unions (UBFU) and the Indian Banks’ Association (IBA) have been discussing the Group Medical Insurance Policy for retired bank employees. Wages for more than eight lakh bank employees are negotiated by the IBA and trade unions every five years.
The government had told IBA that it expected the negotiation process for the 12th bi-partite settlement to take place and the matter to be finalised by 1 December 2023.
Now, Money Control reports that the Indian Bank Association (IBA) has given its approval to the 12th bipartite agreement which will remain in effect for the next five years, with effect from 1 November, 2022, which is when the wage revision for public-sector banks has been due since.
Post discussions between IBA and bank unions in Mumbai, it was agreed that dearness allowance (DA) up to 8088 points of price index would be merged with the basic pay.
In November 2020, IBA had signed a bipartite settlement with bank unions that approved a 15 per cent hike in pay slip for bank staff. This hike was for the period November 2017 to October 2022.
This would result in an annual burden of Rs 7,900 crore for the banks.
Performance-linked pay has also been introduced, to advocate some level of competitiveness amongst staff.
The government wanted early wage revision to help make working conditions of employees better and offer them incentives.