Bank unions and the Indian Banks’ Association (IBA) on Monday signed the 10th bipartite wage agreement which will lead to an additional outgo of Rs 4,725 crore every year for the banking sector.
The hike will be effective from November 2012, when the last five-year bipartite agreement expired, and will benefit 10 lakh employees. The agreement also includes better hospitalisation and medical coverage for the employees who can avail 100% reimbursement for self and the dependent from 90% and 75% earlier, respectively.
“We have taken a consolidated policy from four public sector non-life insurance companies with Rs 4 lakh and Rs 3 lakh floater cover for the family. Now, a cashless facility will be available with 100% reimbursement for self and dependent,” said TM Bhasin, IBA chairman.
The increase in salary will be calculated on the total payslip component that includes basic pay, dearness allowance, house rent allowance and other benefits.
A settlement was reached between the unions and the IBA on February 23, following which, the unions who were demanding an increase of 19.5%, called off their four-day strike .
The bipartite agreement also provides bank employees a day off on every second and fourth Saturday of the month.
“As regard to the holiday on second and fourth Saturday, the Reserve Bank of India (RBI) has given the in-principle approval and we wrote to the government 10 days ago. We hope that in consultation with the law ministry, we will soon get the permission and once notification is issued under the negotiable instruments Act, we will implement the holiday,” Bhasin explained.
This round of wage negotiations that began in November 2012, have seen employees participate in several strikes.
While the IBA started negotiating for an increase of 5%, the unions were initially asking for 25%. In the next few rounds, the IBA gradually increased it to 12% while the unions came down to 23%.
The last wage-hike settlement was in 2010, when salaries were raised by 17.5%. Wages in the banking sector are governed by industry-level bipartite settlements signed between the IBA and unions.
Wage deal
The hike will be effective from Nov 2012, when the last five-year bipartite agreement expired, and will benefit 10 lakh employees.
The agreement includes better hospitalisation and medical cover for employees who will now avail 100% reimbursement for self.
The salary hike will be calculated on the total payslip component, including basic pay, DA, house rent allowance and other benefits.
Source - The financial Express