Bank union strike on June 27 demanding 5-day work week & old pension

Bank employee's unions are planning a one-day nationwide strike on June 27 to demand a five-day work week, the restoration of the old pension scheme (OPS), and an update to the pension amount.

After a meeting in Mumbai attended by all of the constituent unions, the United Forum of Bank Unions (UFBU), a nine-member umbrella body of bank unions, called for the strike.

The strike, according to union leaders, is primarily directed at the Indian Banks' Association (IBA), a representative body of the management of state-owned banks and financial institutions that has been sitting on a number of non-financial demands of banking employees for several years. If the issues are not resolved quickly, an estimated 10 lakh employees are expected to join the strike.

After deliberating the "undue delay by IBA in resolving the residual and pending issues," the UFBU decided to call a strike, the union said in a statement on June 9. Workweek and pension are two of the "important issues" that the bank unions are pushing for.

"Both of these have long been among the major non-financial demands made by bank unions. The unions want all Saturdays and Sundays to be declared holidays, as well as the National Pension Scheme to be abolished (NPS). "There are other pending issues as well," UFBU convenor Sanjeev K Bandlish told me over the phone.

According to Bandlish, the unions have raised these issues several times during traditional wage negotiations, but to no avail. "The IBA promised us a resolution several times, but nothing happened," he continued.

All bank employees are currently off on the second and fourth Saturdays of each month, and direct benefits under the OPS have been discontinued for employees hired after April 2010. The latter decision was reached during the ninth bipartite settlement, while the first was reached during the tenth.

Wage negotiations in the banking industry, unlike other public sector companies, are the result of an agreement between bank unions and the IBA—wage revision occurs every five years. In July 2020, the 11th bipartite wage agreement was signed.

Wage negotiations, which typically last years before reaching an agreement between the two parties, have traditionally included unions raising demands related to service conditions.

Similarly, during the 10th bipartite wage talks, the unions raised the demand for a five-day week for the first time.

"The IBA told us that on an experimental basis, it will allow off days on two Saturdays every month, after which the five-day week demand will be considered." Following that, permission from the RBI and the Central government was obtained, private and foreign banks came to an agreement, and service conditions improved," Bandlish explained. In May 2015, the tenth bipartite settlement, which covered 43 banks, was signed.

The issue of a five-day workweek resurfaced during the 11th bipartite wage negotiations, but both parties agreed to revisit it later. Despite multiple requests from unions to hold discussions as required by the agreement, the IBA has not convened a single meeting since then.

"More than 65 per cent of banking employees are under the age of 40, have a large workload, and are under a lot of pressure to meet targets." A five-day work week will relieve their work stress and is also beneficial to their weekly rejuvenation, according to Dutta.

Any change in the work week, however, will require the approval of the RBI, the Centre, and private banks, as in the past.

MARKET-LINKED NPS ARE FLAYED BY BANK STAFF

In the meantime, given the risks associated with the new market-linked pension scheme, unions are pushing for OPS to be reinstated. According to Dutta, the OPS had numerous advantages before being replaced by the NPS in April 2010 for employees hired after April 1, 2010.

The OPS was established under the Central Civil Services (Pension) Act of 1972, which stipulated that no employee contribution was required and that the pensioner would receive 50% of his or her last drawn salary. The NPS, on the other hand, is a contribution-based pension scheme that was introduced by the then-Atal Bihari Vajpayee government in December 2003.

The pension amount is market-linked, so it does not serve as a safety net for employees. The scheme has also drawn criticism from a wide range of government employees across the country.

NPS covers more than half of the staff in public sector banks, according to Dutta, who lamented that these employees deserved a better plan to protect their retirement period. "We're also calling for a change in pension rates for OPS employees." Unlike Central government employees, the basic pension, excluding dearness allowance, has not been revised for public sector banking employees since 1995, according to Dutta.