In
a landmark decision, the Indian Banks’ Association (IBA) and workers’ unions
recently inked an agreement to enhance the salaries of employees in public sector banks by a substantial 17%, totaling a staggering Rs 12,449 crore. This
momentous decision, affecting approximately nine lakh employees, including 3.8
lakh officers in PSU banks like SBI, marks a significant leap in the financial
well-being of the banking sector workforce. The agreement, reached on December
7, 2023, through detailed discussions, promises a positive change in the lives
of countless bank employees. According
to the press release: “The joint note declares all Saturdays
as public holidays until the government announces. The
revised working hours will come into effect after the announcement. The Indian Bankers Association(IBA) and the Bank Officers’ Associations. The staff and the
employees’ unions successfully reached a major wage agreement that
will ensure a significant 17 percent increase
in wages for officers and employees wage revision
and a total of 12.589 billion across 12
public banks participating in the 12th Bipartite Settlement.
This move, subject to necessary
approvals from the Centre and the Reserve Bank of India, aims to enhance the
work-life balance of bank employees.
Bank Employees Salary Revision Latest News:
After a prolonged wait, the IBA and bank unions have settled
on a 17% annual salary increase for five years, commencing from the fiscal year
2021-22. This eagerly anticipated wage revision will be effective from November
1, 2022. However, the prospect of a 5-day work week remains uncertain, as
unions advocate for the declaration of all Saturdays as public holidays for
banks. The distribution of annual wage increases for bank employees will be
meticulously calculated, taking into account the fiscal year 2021-22
expenditures.
Bank Employees Salary Hike:
Both parties are committed to finalizing a detailed
agreement within 180 days from the signing of the Memorandum of Understanding
(MoU). The IBA has recommended declaring all Saturdays as holidays for the
banking industry under the NI Act, a proposal currently awaiting clarity. The
ongoing negotiations encompass various issues, including the implementation of
this recommendation before signing the final agreement.
Key Points on the 12th Bipartite settlement
1. * The new pay rates commence from November 1, 2022, and will
remain in effect for five years.
2. * A substantial 17% increase in salary and allowances,
amounting to Rs 12,449 crore for all public sector banks, including the State
Bank of India.
3. * The calculation of the new pay involves merging Dearness
Allowance points up to 8088 with the basic pay as of October 31, 2022, plus an
additional 3%, totaling Rs 1795 crore.
4. * Annual wage increases for workers and officers will be
determined separately based on the fiscal year 2021-22 expenditure breakdown.
5. * Ongoing discussions regarding pension updates for retirees,
with a one-time ex-gratia amount agreed upon for pensioners and family
pensioners as of October 31, 2022.
6. * Applicability of the ex-gratia for retirees of the current
settlement period to be discussed later, unaffected by other allowances.
7. * Recommendation to declare all Saturdays as holidays for the
banking industry under the NI Act, with an unclear status.
8. Resolution of all matters raised during negotiations,
including ex-gratia payments for pensioners of private sector banks and foreign
banks.
Bank Employees Salary Hike Calculator:
With the 12th Bipartite settlement for bank employees
finalized, employees are eager to calculate their new pay. The 17% salary hike,
including a 3% load factor, will result in a comprehensive increase on the
payslip. The Dearness Allowance is merged with the current basic pay, and the
Special Allowance is pending as of 7/12/2023.
Here’s
a breakdown of the 12th
BPS salary calculation with a 17% hike:
- Load Factor Explained: The load factor, considered in the 12th BPS, benefits bank staff by taking into account both BASIC and DA. This load factor of 3% is applied to both BASIC AND DA.
- Total
Salary Increase: The total salary increase is exactly 17% as
per the 12th BPS settlement. For example, the gross salary before
the 12th BPS
was Rs. 74,125, and after the 12th BPS, it becomes Rs. 89,601, resulting
in a 17% increase on the payslip, as stated in the 12BPS final negotiating
committee.
- Calculation
for Officers’ Salaries: A salary chart is provided for an
employee who joined the bank in 2021 with a basic pay of Rs. 36,000 in the
11th BPS. The employee, having completed JAIIB and CAIIB certification
courses, receives 1 increment for each. With two yearly increments in 2022
and 2023, the total
increments are 4 (1+1+1+1). Each increment is Rs.
1490 in BASIC PAY for officers. The chart shows the salary calculation for
an Officer employee with CAIIB qualification and 2 yearly increments.
- 1
Lakh Plus Salary in Banks: An officer in banks with CAIIB
qualification and 2 years of experience will receive a gross salary of 89k. With
additional allowances like rent and petrol, the gross salary of an officer
employee in banks can exceed 1 lakh, which is good news for bank staff.
- Salary
Slip Components Load Factor: The components of the payslip for
an officer employee in banks are BASIC, DA, SPECIAL ALLOWANCE, and LOAD FACTOR. The
chart shows the load factor of 3%, calculated for the new basic pay of the
12th BPS and new DA, i.e., 3%
of (56212+10286) = 1994.
Bank
New Salary After Wage Revision
- Good
news for public sector bank employees! A 17% wage hike is on the way,
following the agreement between Indian Banks’ Association (IBA) and
bank unions on the 12th bipartite settlement.
- The
total annual salary for all banks, including the State Bank of India, is
set at Rs
12,449 crore.
- The
revision will be effective from November 1, 2022, for five years. New pay
scales will consider a 17% increase in salary and allowances, with the
Dearness Allowance and a 3%
loading factor.
IBA recommends a five-day
work week, and unions want its implementation before the final agreement,
expected in the next 180 days. This follows a 15% hike in July 2020 for
around 850,000 bank
employees.
FAQ
How much salary will increase after the 12th Bipartite Settlement?
The salary increase after the 12th
Bipartite Settlement is a substantial 17%, totaling Rs 12,449 crore for all
public sector banks, including the State Bank of India.
What
is the period of the 12th Bipartite Settlement?
The 12th Bipartite Settlement is
effective for five years, starting from November 1, 2022.
What
is the salary revision in banks?
The salary revision in banks, as per
the 12th Bipartite Settlement, involves a 17% increase in salary and allowances
for a period of five years.
What
is the load factor in salary?
The load factor in the salary
calculation for the 12th Bipartite Settlement is 3%. This factor is applied to
both Basic and Dearness Allowance, contributing to the overall salary increase.
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