In a significant development, the Indian Banks’ Association (IBA) and employee unions representing state-owned banks have successfully reached a new wage settlement, paving the way for a substantial pay raise for nearly 7.56 lakh public sector bank employees, including those at the State Bank of India (SBI). The agreement, which spans the next five years, will see an annual increase of 17% in salaries and allowances.
The joint memorandum, signed by the IBA and authorized representatives of workmen’s unions and officers’ associations, marks the conclusion of extensive discussions on wage revision for officers and workmen in the banking sector. This settlement requires public sector banks to allocate nearly Rs 12,500 crore more annually towards employee salaries and allowances.
For the financial year 2023, the State Bank of India’s total wage bill was estimated to be Rs 57,292 crore, underlining the substantial financial impact of the wage settlement on the banking sector.
In line with previous agreements with unions, the IBA has proposed to the government that all Saturdays be declared holidays under the Negotiable Instruments (NI) Act for the banking sector. If approved, this move would transition banks to operate only from Monday through Friday, aligning with the banking week observed in the US and many other countries. Presently, Indian banks are closed on the second and fourth Saturdays of each month.
A notable advocacy point from the bank unions is the push for designating every Saturday as a holiday. The memorandum jointly signed by the IBA and unions highlights that the unions/associations are urging the implementation of this proposal before the finalization of the bipartite agreement/joint note.
This agreement is expected to have far-reaching implications for the banking sector, influencing not only the financial landscape for public sector banks but also potentially reshaping the traditional workweek in the industry.
