A Historic Accord: Indian Banks’ Association Approves 17% Wage Hike and All Saturdays as Holidays

In a landmark decision, the Indian Banks’ Association (IBA) and bank employee unions have forged a historic agreement, green-lighting an annual wage hike of 17% and recognizing all Saturdays as holidays, contingent on government notification. The anticipated revision of working hours is scheduled to be implemented once the government issues an official announcement.

The 17% wage hike is expected to incur an additional annual expenditure of approximately Rs 8,284 crore for public sector banks, benefiting around 8 lakh bank employees. The commencement of the wage hike is set for November 2022, marking a pivotal moment for the banking industry, as highlighted by Sunil Mehta, the Chief Executive Officer of IBA.

The ripple effect of this agreement extends to retired employees, who stand to gain from a provision for a monthly ex-gratia amount, in addition to the pension or family pension offered by Public Sector Banks, including SBI. This provision is applicable to those eligible for pension on or before October 31, 2022.

Key Points:

1. PSU Bank Employees to Enjoy 17% Salary Hike: The increment takes effect from November 1, 2022, with officers completing CAIIB (CAIIB Part-II) receiving two additional increments.
2. New Pay Scales Post-IBA Pact: The new pay scales include the merger of Dearness Allowance corresponding to 8088 points, resulting in an effective load on the basic pay of 4.20% after the applicable load of 3.22%.
3. Enhanced Benefits for Female Employees: Female employees are now entitled to one sick leave day per month without the need for a medical certificate.
4. Privilege Leave Encashment: Accumulated privilege leave can be encashed up to 255 days upon retirement or in the event of an employee’s death while in service.
5. Monthly Ex-Gratia for Retired Employees: Retired employees will receive a monthly ex-gratia amount, enhancing their financial security.

This groundbreaking wage settlement introduces positive changes and benefits for PSU bank employees, reinforcing their working conditions and financial well-being, and setting a new standard for industry agreements.