Employees of public sector banks (PSBs) in India can welcome the end of 2023 on a positive note, as the Indian Banks' Association (IBA) sealed a significant 17% annual wage hike agreement with bank unions on Thursday.
This wage revision, effective from November 1, 2022, will span a period of five years. The IBA and bank unions formalized a Memorandum of Agreement at their meeting, outlining the terms of the agreement. The 17% increase in pay slip cost, additional loading of three percent post-dearness allowance merger, and improved pension for pensioners from 1986, including retirees under the proposed 12th bipartite settlement, were key elements of the agreement.
The financial impact of the wage revision is estimated to be Rs 12,449 crore for all public sector banks, including the State Bank of India (SBI). The new pay scales will be determined by merging Dearness Allowance and adding a 3% loading, amounting to Rs 1,795 crore.
The agreement also recommended five-day banking to the government for favorable consideration. Notably, the earlier wage agreement provided bankers with a 15% wage increase.
As part of the ongoing collaboration, the parties agreed to meet on mutually convenient dates to establish a detailed Bipartite Settlement/Joint Note, addressing various consensus positions. Both parties aim to finalize the Bipartite Settlement/Joint Note within 180 days from the date of the minutes.
(With Agency Inputs)
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