In a significant development for the banking sector, the All India Bank Officers' Confederation has announced the successful conclusion of discussions with the Indian Banks Association (IBA), leading to the signing of the 9th Joint Note on March 8, 2024. This landmark agreement brings forth two major changes: a transition to a five-day work week and a substantial 17% annual salary raise for bank employees.
According to a press release by the All India Bank Officers' Confederation, the Joint Note recognizes all Saturdays as holidays, subject to government notification. The revised working hours will come into effect only after the government issues the necessary approval, notifying all Saturdays as holidays under Section 25 of the Negotiable Instruments Act.
The negotiated 17% annual salary raise, effective from November 2022, is expected to result in an additional yearly expenditure of approximately Rs 8,284 crore for public sector banks. This significant hike will benefit up to 8 lakh bank workers across various scales.
The new working hours are yet to be officially specified, but reports suggest that employees may work an additional 40 minutes per day, extending the workday from 9:45 a.m. to 5:30 p.m.
Bank customers, particularly those accustomed to handling their banking affairs on Saturdays, are likely to be affected by this change. However, with the widespread availability and usage of alternative banking methods such as mobile banking, ATMs, and internet banking, the impact on customers is expected to be mitigated.
The government's approval is crucial for the implementation of these changes, as per the stipulations in Section 25 of the Negotiable Instruments Act. The government's role is underscored by its ownership of public sector banks, and the Reserve Bank of India (RBI) must also endorse the plan, given its influence on the timing of interbank activities.
The All India Bank Officers' Confederation, in its press release, stated that the total quantum of the wage revision increase is more than Rs. 8,284 crores, constituting 17% of the cost of the Payslip component of establishment expenses of Public Sector Banks. The new scales of pay will range from Rs. 48,480/- to Rs. 173,860/-, covering all scales from Scale I to VII, with effect from November 1, 2022.
As the banking sector awaits the government's approval, these developments mark a significant step towards modernizing working conditions for bank employees and could have a lasting impact on the industry's operational landscape.