History of 11th Bipartite Wage Settlement
The hike in wages of bank employees is discussed every five years between IBA (Indian Banks Association) representing bank managements and UFBU (United forum of bank unions) representing bank employees’ unions.
During the 10th Bipartite wage settlement, a hike of 15% in the salaries of PSU bank officers and clerks were agreed upon between IBA and UFBU.
The eleventh bipartite wage settlement is due since 1st November 2017. After various rounds of discussions, IBA & UFBU reached an understanding in the meeting dated 22nd July 2020. As per the MOU, IBA has agreed for a 15% increase in the wage bill of banks as on 31st March 2017. Further 47.80% of dearness allowance (DA) shall be merged with basic pay along with a 2.5% loading factor to arrive at new pay scales. The other payslip components are to be decided in the next round of meetings with a maximum of 12.50% of payslip components.
In the agreement, it has been agreed to introduce performance-linked incentives to improve the efficiency of banks. Further employees can encash Privilege leave maximum up to 7 days during a calendar year (from the current period only).
The complete agreement is expected to be finalized within 90 days. The increased salary of employees along with arrears, fitments, etc is expected to be finalized during this period. The demand by unions for five days working is also under discussion.
Further Sh. Rajnish Kumar, the Chairman of IBA has informed that IBA has agreed in principle to remove ceilings on family pensions and it shall be paid at a uniform rate of 30%. The 11th bipartite wage settlement shall be effective for the period up to October 2022 & the 12th bipartite wage settlement shall be due from November 2022.
In terms of UFBU CIRCULAR NO. 08 DATED 23.07.2020, the main features of the Memorandum of Understandings signed with IBA for 11th Bi-Partite Settlement are as under:
- The 11th Bipartite Wage revision/Joint Note for Officers will be effective from 01-11-2017.
- Increase under this Wage Revision will be Rs.7898 crores per year i.e. 15% on the wage bill of PSBs (payslip component cost) as on 31.03.2017.
- New pay scales would be worked by merging DA upto 6352 points of price index with an additional loading of 2.5%.
- After prolonged discussions and deliberations, it has been agreed to introduce Performance Linked Incentive (PLI) in Public Sector Banks, which will be based on Operating/Net Profit of the individual bank(optional for private & foreign banks). The PLI is payable to all employees annually over and above the normal salary payable. The PLI matrix decides the amount payable to the employees (in number of days of pay=Basic+DA) depending on the annual performance of the Bank. All the employees will get the number of days of pay as incentive depending on where in the matrix the Bank’s performance fits in, broadly as per Matrix under:
Sr.No. | YoY Growth in Operating Profit | No.of days for which Salary (Basic + DA) shall be paid |
1 | <5% | Nil |
2 | 5% to 10% | 5 days |
3 | >10% to 15% | 10 days* |
4 | >15% | 15 days* |
*3rd and 4th slabs are payable only if the Bank has Net Profit. If a Bank has growth in Operating Profit of 5% & more, but there is no Net Profit, then minimum 2nd slab of 5 days will be payable.
(The PLI will be applicable from FY-2020-21)
- From this calendar year each employee below 55 years of age can encash PL upto 5 days per year for any one festival ( 7 days for those above 55 years of age).
- For employees who have joined the Banks under NPS, management’s contribution would be at 14% of Pay and DA against 10% now.
- Improvement in service conditions discussed and agreed upon so far would be duly incorporated in the final settlement.
- All other pending issues including 5 days banking, updation of pension, etc. are open and would be further discussed.
- The full-fledged and final settlement with revised pay scales and allowances and incorporating all the agreed issues would be concluded within the next 90 days.
- Thereafter, the Settlement will be implemented and revised salaries would be paid accordingly.
About 11th Bipartite Settlement Calculator
The 11th bipartite settlement calculator has been designed based on the recent agreement between IBA & UFBU. Since the merger of DA and load factor has already been decided the new basic pay has been calculated based on the same.
Further another major Pay slip component i.e. Special allowance is yet to be finalized. The special allowance has been considered as 15.50% as per the best available information. The component may be higher for higher scales i.e. Scale lV & above keeping in view the Special allowance as per 10th Bipartite settlement (where it was higher for Scale IV & above).
The expected increase in salary has been calculated only for major pay slip components i.e. Basic Pay, Dearness allowance & Special allowance. The main reason behind the same is that except Basic pay & Dearness allowance all other components are yet to be finalized and excess assumptions could have lead to distortion of results along with the complexity of the calculator.
The users may add current CCA, PQP, etc to New Gross pay as per calculator to get a more precise calculation of gross salary after implementations of 11th BPS.
1 comment:
Before asking for Levy union should reveal their asset and future plane for this assets. Shameless fellow. Historic statement,Bakvas
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