The Indian Banks’ Association (IBA) and United Forum of Bank Unions are close to reaching an agreement on wage hike for employees of state-owned banks, a senior finance ministry official said on Wednesday.
“As per the understanding between unions and IBA, bank employees are likely to get another option for pension and wage hike of 17.5 per cent,” the official said. The hike would come into effect from November 2007 for a period of five years. Nearly 1 million bank employees are likely to benefit from the wage revision which is likely to cost the banks nearly Rs 4,800 crore annually.
“Employees opting for the pension now will have to share 30 per cent of the burden, while remaining 70 per cent will be borne by the banks,” the official said. The total outgo on account of a fresh option for pension is likely to be Rs 6,000 crore on annualised basis.
“Of this, Rs 1800 crore will be shared by the employees while the remaining Rs 4,200 crore will fall on banks,” the official said. Nearly 250,000 bank employees will benefit from the fresh option for pension.
“Some ground has been covered. It’s difficult to say how close we are to reaching an agreement. There are still some hurdles,” CH Venkatachalam, said convenor, United Forum of Bank Unions. United Forum of Bank Unions, an umbrella organisation representing nine major banking trade unions, represents about 1 millon bank employees and officers from across the country.