AFTER 100 DAYS OF NEW GOVERNMENT
NO KHUSHI, STILL GHAM
FOR BANK EMPLOYEES
by
S.SRINIVASAN
Retired Bank Unionist
In 1933, when Franklin D Roosevelt
summoned a special session of Congress that would run for three months, the
newly elected president got the Democrats and Republicans to work together and
give Congressional passage to a series of measures aimed at job-creation and
providing an impetus to a tottering economy. Those 100 days of Congress, also
his first 100 days as president, saw 15 major bills get passed, a record for US
legislation that FDR would go on to call the 'New Deal'.
That’s how the "first 100
days" yardstick of measuring the effectiveness of new governments came to
be fashioned, a measure of how much a government can achieve when it’s still in
the afterglow of electoral success, riding high on public opinion and driven by
high expectations.
At the end of 100 days there is,
doubtless, a stock-taking. There are be more pithy slogans and catchy,
self-congratulatory phraseology.
During thee 100 days Bank unions met Finance Minister to press for early wage revision on
June27, 2014. Despite a lapse of 21 months since the start of negotiations,
no significant improvement has been made towards expeditious conclusion of
settlement.
Make no mistake, the speeches to the countrymen by the new
government will continue to be fine tuned, but the first 100 days is just
bluster for bank employees expecting just wage revision of at least restoring
parity with Central Government Employees sequel to the 6th pay commission,
going by early indications and reports.
Yes, “ache din” (good days)
have indeed come for some. But “bad days” have befallen to the Bank employees.
The preposterous, stubborn stand of IBA resulting in replacement of traditional ‘round table negotiations’ with
‘correspondences’ after the last meeting on 13th June 2014 has
shattered our hopes and battered our dreams of an early settlement. The entire workforce have felt the insult inflicted by IBA, who
failed to live upto the expressions made by IBA Chairman in the first round of
discussions held on 22-03-2013 that “the
settlement would be concluded at the earliest with reasonable, respectable and
comparable wage revision compared with external factors”.
In short we
are not hearing sunny sonnets or moonlit
melodies of successful breakthrough in the wage revision , but fumbling by the Government, bungling by IBA combine , crumbling of industrial peace, grumblings by the customers and rumblings of a
might upsurge of bank employees, who awakened and are in readiness to write
history with blood and tears.
OUR STAND OF
25% HIKE IS JUST AND SACROSANCT!
Justification I: It Is Lawful
The
intransigence stand of IBA in not
calling union for negotiations, disregarding sprit of bipartite culture ,
unique in banking industry culminating
in 9 bipartite settlements so for,
suddenly without any logical, transparent reasons, during this 10 bipartite
under progress after 13-06 -2014 is preposterous.
Even with 25% increase we will be lagging
behind the government employees if one realistically evaluates their projection
in wake of announcement of 7 pay commission in the anvil.
My arguments is backed By Justice Kantilal Desai in
his award popularly known as Desai Award. Hence our demand of 25% hike to restore parity with
government employees and other PSU‘s is just and right, and is accordance with
awards in force for bank employees. Abrogating the legal sanctity of these
awards of learned judges by peddling spurious logic tantamount to disrespecting
the laws of the land.
Our
terms have always been clear. The IBA’s
terms have also been clear, of course according to them, for which we can never
come to terms. They always find, as was
the experience in the earlier negotiations, our demand and our stand to be
irrational and unreasonable and yet to have conceded to some of them. So whatever we conceded is reasonable for
them and what we do not concede is unreasonable for them. The reality today is nothing is well settled
in labour matters in our country. The
little achievements we have secured are not because our demands were reasonable
but that each achievement is incomplete inspite of its reasonableness. It required bitter struggles before inch of
progress could be made. Throughout this
historic century of struggles runs one red thread of continuity is - resistance
- by the employers to demands of the employees for improvements even though
reasonable. The strange arguments
advocated by the Bank Lords before the Tribunal for the Bank’s disputes and now
by IBA, stand eloquent witness to this conviction. I request the readers to
google and go through the spur4ios arguments denying bank employees reasonable
wages even during the Desai award (1962) days (see para 5.159. to 5.161, page 170
desai ward)
We
know the methods IBA used to adopt to dilate our issues and hoodwink our
demands. But this time the boldness,
sophistry, ruthlessness and courage with which they have come out openly and
spelt out their unwillingness to accept our reasonable demands and response
makes bipartite culture a mockery.
Denial
of our just demands is unconscionable and unjustified.
If
today in our anxiety to secure arrears and marginal increase in wages, we
compromise on principles in accepting their unreasonable, irrational demands,
tomorrow we will be compelled to sign on dotted lines even in matters suicidal
to our interest.
IBA’s
spurious, perverse theories which we exposed and exploded as the past are again
in the market of industrial relations with their spurious products sowing seeds
of industrial unrest. Their pet theories
are standing monuments of our agony and stumbling block for industrial peace.
I
have made some made so modest attempt to enhance the awareness of bank
employees culling important facts form the glimpses of history. let history
record that in spite of the greatest odds Bank employees would stand up and
resist injustice and reject with disdain and contempt the demands of IBA with
logic and reason , retaining the ground sells of historical perspective.
Needles to underscore that the present is imbedded in the past and from the
present future grows as per law of nature.
Let
us get emboldened form history:
Principles of Wage Fixation Source: Desai Award
5.35.
This Tribunal has been constituted under the Industrial Disputes Act, 1947. The
preamble to the Act indicates that the said Act was enacted to make provision
for the investigation and settlement of industrial disputes, and for certain
other purposes appearing in the said Act. Under section 7B, the Central Government is empowered to constitute one or more National Industrial
Tribunals for the adjudication of the industrial disputes which, in the opinion
of the Central Government, involve questions of a national importance or for
the adjudication of industrial disputes which are of such a nature that
industrial establishments situated in more than one State are likely to be
interested in, or affected by, such disputes. In considering disputes the
adjudication whereof involves questions of a national importance it would not
be out of place to refer to the following words of the Preamble to the Constitution
of India which express the will of the people of India :—
“We, the People of India, having solemnly
resolved............to secure to all its citizens : Justice, social, economic
and political; ............ Equality of status and of opportunity; and to
promote among them all Fraternity assuring the dignity of the
individual..................... give to ourselves this Constitution.”
By
the Directive Principles of State Policy embodied in Article 43 of the Constitution
it is provided that the State shall endeavour to secure, by suitable legislation
or economic organisation or in any other way to all workers, agricultural,
industrial or otherwise, work, a living wage, conditions of work ensuring a
decent standard of life and full enjoyment of leisure and social and cultural
opportunities.
5.36.
On 21st December 1954 the Lok Sabha adopted a resolution by which the
establishment of a socialistic pattern of society has been accepted as the
objective of State Policy with the consent and concurrence of all the political
parties in the country. The adjudication in respect of the matters referred to
the Tribunal has to be done in the background of the statement in the Preamble
to the Constitution, the Directive Principles of State Policy and the
resolution unanimously adopted by the Lok Sabha.
5.37.
The jurisdiction of a National Industrial Tribunal in determining matters which
come before it is in certain respects wider than the jurisdiction of an
ordinary Court of law. An ordinary Court of law proceeds on the footing that no
power exists in the Courts to make contracts for persons and that the parties
must make their own contracts. The Courts reach their limit of power when they enforce contracts which
the parties have made. An Industrial Tribunal is not so fettered and may create
new obligations or modify contracts in the interest of industrial peace, to
protect legitimate trade union activities
and to prevent unfair practice or victimisation. It has been so held by
the Supreme Court in Rohtas Industries Ltd. v. Brijnandan Pande and others, 1956
Supreme Court Report 800, 1956 (II) Labour Law Journal 444 at page 449.
As observed by Ludwig Teller in Labour Disputes and Collective Bargaining, Vol.
I at page 536 :—
“Industrial
arbitration may involve the extension of an existing agreement, or the making
of a new one, or in general the creation of new obligations or modifications of
old ones, while commercial arbitration generally concerns itself with
interpretation of existing obligations and disputes relating to existing agreements.”
The
Federal Court in the case of Western India Automobile Association Ltd. v.
Industrial Tribunal and others, 1949 Federal Court Report 321 at page 345, 1949
Labour Law Journal 245, has observed that the above statement by Ludwig Teller
was a true statement about the functions of an Industrial Tribunal in Labour
disputes. The relations between employers and employees
are
no longer left to the free play of economic forces. The concept of social and
economic justice as embodied in the Directive Principles of State Policy comes
into play. The needs of the industry have to be harmonised with the needs of
the workmen and the dignity of the individuals. To secure a living wage is the
objective of State Policy. Before a living wage can be secured to workmen
various factors have to be considered. The industry concerned must have the
capacity to bear the burden of a living wage to workmen
5.38. Wages have been considered under
three different heads:—
(1) Living Wage,
(2) Fair Wage, and
(3) Minimum Wage.
These concepts have been fairly dealt
with in the report of the Committee on Fair Wages. A large part of its
conclusions has been accepted by the Supreme Court in the case of Express
Newspapers (Private) Ltd. and another v. The Union of India, 1959 Supreme Court
Report 12, 1961(1) Labour Law Journal 339. The most expressive definition of a living
wage is that given by Justice Higgins of the Australian Commonwealth Court of
Conciliation in the Harvester case. A living wage is defined by Justice Higgins
as one appropriate for “the normal needs of the average employee, regarded as a
human being living in a civilised community.” This cryptic pronouncement has
been explained by Justice Higgins by saying that a living wage must provide not
merely for absolute essentials such as food, shelter and clothing but for “a
condition of frugal comfort estimated by current human standards.”It must be a
wage “sufficient to insure the workman
food, shelter, clothing, frugal comfort, provision for evil days, etc. as well
as regard for the special skill of an artisan if he is one.” In a subsequent
case he observed that “treating marriage as the usual fate of adult men, a wage
which does not allow of the matrimonial condition and the maintenance of about five persons
in a home would not be treated as a living wage”.
In the Report of the Committee on Fair
Wages it is stated in paragraph 7 as under :—
“there is general agreement that the
living wage should enable the male earner to provide for himself and his family
not merely the bare essential of food, clothing and shelter but a measure of
frugal comfort including education for the children, protection against
ill-health, requirements of essential social needs, and a measure of insurance against
the more important misfortunes including old age.”
5.39.
A reference may be made to the following observations of Mr. Philip Snowden at
pages 1 and 6 of “The Living Wage” in connection with the concept of a living
wage and the problem of converting the concept into monetary terms :—
“It
may be possible to give a precise or satisfactory definition of a living wage,
but it expresses an idea, a belief, a conviction, a demand. The idea of a
living wage seems to come from the fountain of justice which no man has ever
seen, which no man has ever explained, but which we all know is an instinct
divinely implanted in the human heart. A living wage is something far greater
than the figures of a wage schedule. It is at the same time a condemnation of
unmerited
and
unnecessary poverty and a demand for some measure of justice.”
• • • •
“The
amount of the living wage in money terms will vary as between trade and trade,
between locality and locality. But the idea is that every workman shall have a
wage which will maintain him in the highest state of industrial efficiency,
which will enable him to provide his family with all the material things which
are needed for their health and physical well being, enough to enable him to
qualify to discharge his duties as a citizen.”
The
Supreme Court in the case of Standard Vacuum Refining Company of India Ltd., v.
Its workmen (including clerical staff) and another (Petroleum Refineries
Employees’ Sabha) reported in 1961(1) Labour Law Journal page 227 at page 234
has observed that it is in the aforesaid broad and idealistic sense that a
reference has been made in Article 43 of the Constitution to the
living
wage. The concept of a Living Wage is not a static concept. In connection with
the concept of basic minimum wage, fair wage and living wage, the Supreme Court
has in the aforesaid case observed at page 233 as under:—
“the
concepts of these wages cannot be described in definite words because their
contents are elastic and they are bound to vary from time to time and from
country to country.................................... What is a subsistence
wage in one country may appear to be much below the subsistence level in
another; the same is true about a fair wage and a living wage; what is a fair
wage in one country may be treated as a living wage in another, whereas what
may be regarded as a living wage in one country may be no more than a fair wage
in
another.”
It has further observed at page 239 that under the living wage a workman would
be entitled to claim an optimum diet as prescribed by Dr. Aykroyd. Similarly
the requirements as to clothing and residence which have been recognised in the
tripartite resolution, though appropriate in reference to a
need
based minimum wage would have to be widened in relation to a living wage. Besides, in determining the
money value of the living wage it would benecessary to take into account the
requirements of “good education for children, some amusement, and some
expenditure for self development.”
5.40.
In connection with the concept of a minimum wage, it has been observed by the
Committee on Fair Wages that a minimum wage must provide not merely for the
bare sustenance of life but for the preservation of the efficiency of the
worker by providing for some measure of education, medical requirements and
amenities. It has been further observed that the minimum wage must be paid
irrespective of the capacity of the industry to pay the same. In connection with the concept of
minimum wage a reference is necessary to the resolution passed at the 15th
Labour Conference held at New Delhi on 11th and 12th July, 1957 wherein certain
norms have been laid down. The same
have been considered at some length in another part of this
award.
5.41. In connection with the fair wage,
it is observed by the Committee on Fair Wages that there was complete unanimity
of opinion that the fair wage should on no account be less than the minimum
wage. The Supreme Court in the case of the Express Newspapers (Private) Ltd.
has observed at page 364 that the fair wage is “a mean between the living wage
and the minimum wage.” As observed by the Committee on Fair Wages while the lower
limit of the fair wage must obviously be the minimum wage, the upper limit is
equally set by what may broadly be called capacity of industry to pay. Between
these two limits the actual wages will depend on:—
(1) the productivity of
labour;
(2) the prevailing rates of
wages in the same or similar occupations in
the
same or neighbouring localities;
(3) the level of the national
income and its distribution; and
(4) the place of the industry
in the economy of the country According to
the Report of the Committee on Fair Wages
in determining the
capacity of an industry to pay, it would
be wrong to take the capacity
of a particular unit or the capacity of
all industries in the country. The
relevant criterion should be the capacity
of a particular industry in a
specified region to be ascertained by
taking a fair cross section of that
industry. The Supreme Court in the case of
the Express Newspapers
(Private) Ltd. at page 366 has observed
that:—
“The capacity of an industry to pay
should be gauged on an industry cum-region basis after taking a fair
cross-section of that industry. In a given case it may be even permissible to
divide the industry into appropriate classes and then deal with the capacity of
the industry to pay classwise.”
5.42. The level of wages should be so
fixed as to enable the industry to maintain production with efficiency. The
fair wages fixed should not be so out
of tune with wages in other industries
in the region as to cause movement of
labour and consequent industrial unrest.
The Supreme Court in the case of Express Newspapers (Private) Ltd. has
observed at page 336 as follow:-
“The main consideration which
is to be borne in mind is that the industry should be able to maintain
production with efficiency and the fixation of rates of wages should be such
that there are no movements from one industry to another owing to wide
disparities and employment at existing levels is not only maintained but if possible
increased.”
5.43.
E. M. Burns in the book “Wages and the States” has at page 387 referred to various
considerations which have to be borne in mind when fixing wages.
“It
would be necessary to inquire inter alia into the elasticity of demand
for the product, for on this depends the extent to which employers could
transfer the burden of the increased wage to consumers. It would also be
necessary to inquire how far the enforced payment of a higher wage would lead
employers to tighten up organisation and so pay the higher wage without
difficulty.
•
• • •
Similarly
it frequently happens that an enhanced wage increases the efficiency of the
lowest paid workers: the resulting increase in production should be considered
in conjunction with the elasticity of demand for the commodity before the
ability of a trade to pay can fairly be judged.
•
• • •
Again
unless what the trade can bear be held to imply that in no circumstances should
the existing rate of profit be reduced, there is no reason why attempts should
not be made to discover how far it is possible to force employers to bear the
burden of an increased rate without driving them out of business. This would
involve investigation into the elasticity of supply of capital and organizing ability
in that particular trade, and thus an inquiry into the rate of
profits
in other industries, the ease with which transferences might be made, the
possibility of similar wage regulation extending to other trades, and the
probability of the export of capital and organizing ability, etc.”
5.44.
In the First Five Year Plan the authors thereof have observed at page 584 as follows
:—
2 (a) All wage adjustments should conform to the broad principles of
social policy and disparities of income have to be reduced to the utmost
extent. The worker must obtain his due share in the national income.
(b) The claims of labour should be dealt with liberally in
proportion to
the distance which the wages of different categories of workers have
to cover before attaining the living wage standard.
5.45.
The principles of industrial adjudication have been well set out in the
decision of the Supreme Court in the case of M/s. Crown Aluminum Works v. Their
Workmen, reported in 1958 (1) Labour Law Journal page 1 at page 6 in words
following which may well be reproduced here :—
“Though
social and economic justice is the ultimate ideal of industrial adjudication,
its immediate objective in an industrial dispute as to the wage structure is to
settle the dispute by constituting such a wage structure as would do justice to
the interests of both labour and capital, would establish harmony between them
and lead to their genuine and wholehearted co-operation in the task of production.
** In achieving this immediate objective industrial adjudication takes into
account several principles such as for instance, the principle of comparable
wages, productivity of the trade or industry, cost of living and ability of the
industry to pay. **** In deciding industrial disputes in regard to wage
structure one of the primary objectives is and has to be the restoration of
peace and good will in the industry itself on a fair and just basis to be determined
in the light of all relevant considerations.”
5.46.
This Tribunal will have to keep in mind these principles to the extent that
they are applicable in the circumstances of the case.
5.47.
The problem of wage determination cannot be considered in isolation from the
larger economic and social background obtaining in the country. A delicate
balance has to be struck between fair wages to workers and officers fair
profits to the shareholders and fair service at reasonable rates to the community,
after taking into account the share of the Government in profits
in
the shape of taxes and after considering the amounts of reserves and depreciation
necessary for the stability and healthy functioning of the industry.
From the purely economic
point of view the wage policy has to take into account the inflationary
pressures. It is necessary to provide for wage differentials based on job
evaluation as the economic structure in India’ is not founded on the principle
: “to each according to his needs and from each according to his capacity
Para 5.137(page 135)
CAPACITY OF THE
INDUSTRY TO PAY
5.137.
Whilst considering the question of wages in the banking industry, it will be
necessary to consider the question of the capacity of the industry to pay wages
above the bare minimum wage and the place of the industry in the economy of the
country. The question concerning the capacity of an industry to pay wages has
been dealt with at some length by the Supreme Court in the case of Express News
Papers (Private) Ltd., and another v. The Union of India and others, reported
in (1959) Supreme Court Reports, page 12 at pages 89 to 93. As the Supreme
Court has observed in that case, the capacity of industry to pay can mean one
of the three things, viz., (i) capacity of a particular unit, (marginal,
representative or average) to pay, (ii) the capacity of a particular industry
as a whole to pay, or (iii) the capacity of all industries in the country to
pay. After considering the various aspects of the matter, the Supreme Court
has, at pages 92 and 93 of the aforesaid report, observed as follows :—
“The
principles which emerge from the above discussion are:—
(1) that in the fixation of rates of wages which include within its compass the fixation of scales of wages
also, the capacity of the industry to pay is one of the essential circumstances
to be taken into consideration except in cases of bare subsistence or minimum wage
where the employer is bound to pay the same irrespective of such capacity;
(2) that the capacity of the
industry to pay is to be considered on an industry-cum-region basis after
taking a fair cross section of the industry; and
(3) that the proper measure
for gauging the capacity of the industry to
pay should take into account
the elasticity of demand for the product, the possibility of tightening up
the organisation so that the industry could pay higher wages without difficulty
and the possibility of increase in the efficiency of the lowest paid workers
resulting in increase in production considered in conjunction with the
elasticity of demand for the product no doubt against the ultimate background that the burden of the
increased rate should not be such as to drive the employer out of business.”
The
Supreme Court has observed in an earlier paragraph that in a given case it may
be even permissible to divide the industry into appropriate classes and then
deal with the capacity of the industry to pay class-wise. The industry of banking,
in cases where the banks have branches in more States than one, has been dealt
with class-wise, and the capacity of the industry which, so far as the banks
before me are concerned, has to be determined class wise.
Having
regard to the principles enunciated by the Supreme Court, the capacity of the
industry considered class-wise will have to be determined after taking a fair
cross section of each class. As
observed by the Sastry Tribunal the wage structure should be such as to be
within the capacity of the Industry to bear in the light not apply of its
present position, but of its future possibilities also.
5.138.
The industry of banking
does not produce goods but produces services. It is an extremely important
service which is rendered by banks and on the continued and efficient
functioning of banks depends the smooth functioning of a large number of other
industries in the country. In order that the economy of the country may
develop and other industries may function smoothly, it is necessary that the
industry of banking should also develop to meet the growing needs of the
country. Banking has to be regarded as a public service and its activity to a
certain extent is being regulated in the public interest. There
are various provisions in the Banking Companies Act, 1949, and in the Reserve
Bank of India Act relating to the regulation and control of the industry in the
larger interest of the country. Banks have to work in a more or less rigid
framework set by law. The depositing and investing public always plays for
safety for its deposits and stability for its investments. Prudent banker not
merely provide for what are sometimes known as secretor undisclosed reserves
but provide for easy liquidity of some of its assets in order to meet any
emergency. They also consider the advisibility of following the policy of
maintaining stable dividends. Every effort has to be made together the
confidence of the public and the depositors so that the working funds and
operations of the banks may grow.
5.139.
The stability of the industry depends upon the over-riding factor of credit.
The banks are very often described as delicate instruments of credit. The
failure of the bank has its repercussions on the other banks and on the deposits
made with other banks. Great care is required to inspire the confidence of the
public. Deposits received by the banks constitute, to a very large extent, the
raw material for providing advances to persons needing the same. A bank unlike
a manufacturing concern obtains a very large proportion of its working funds
from the depositors and only a small proportion from its shareholders. In
considering the claims of employees, the claims of the depositors and other
constituents of the bank have also to be kept in mind.
5.140. In considering the capacity
of the industry of banking to bear the burden of increased wages which may be
required to be paid having regard to the workmen’s claims based on social
justice, it
is necessary to bear in mind the claim of the shareholders to a fair return on
the capital invested by them.
5.141.
Banking is one of the key industries in the country. The successful implementation
of the Third Five Year Plan depends to a considerable extent
on
the successful operation of banking in the country. It is requisite that the
available
resources of the country should be harnessed for the successful implementation
of the Third Five Year Plan. Banks have an important role to
play
in moblising the resources of the country and canalizing them to productive
purposes. It is necessary that the banking habit should spread throughout the
length and breadth of the country so that the unused wealth of
the
country is not merely gathered but is put to effective use. The dependence of
commerce upon banking has in modern times become exceedingly great and matters
have reached a stage where the cessation for some length of time of banking
activity may paralyse to some extent the economic life of the nation. Bankers
issue credit. Large transactions are effected by means of cheques rather than
by the exchange of currency. Banks assist the industrial undertakings by
underwriting their debentures and shares and occasionally finance the purchase
of real property. Banks serve as custodians of stocks and shares and other
valuables. Imports into and exports out of the country are financed by banks
and documents relating to the goods so imported and exported pass through the
hands of the bankers. They have to deal with warehouse warrants, bills of
leading, railway receipts, bills of exchange, marine insurance policies and
various other documents. They advance moneys on securities and issue letters of
credit and travellers cheques to customers. The functions which the bankers
discharge are numerous and varied. The transactions on the Stock Exchange may
be affected by the policy adopted by banks in connection with the advance on
shares and securities. Transactions of purchase and sale of various commodities
may be affected by the policy adopted by banks in connection with the advance
on such goods. Expansion or retraction of credit may affect financing of
various transactions. The
smooth functioning of banks is necessary for the economic growth and welfare of
the country. Peace in this industry is requisite for the economic progress of
the country at the pace set by the Third Five Year Plan.
5.142.
Having regard to these
factors, wage scales have to be fixed in connection with each class of banks
before me, so that the burden ultimately
imposed may not be such as
may drive any bank managed with reasonable efficiency, out of business. The wage structure
should be such that it should
not
be unduly below the paying capacity of the bank at the top of the class, nor
unduly above the paying capacity of the bank at the bottom of the class, which
is reasonably well-managed. One
does sometimes come across banks in the private sector which continue to
function for a number of years without distributing a naya paisa by way of
dividend, which do not show any substantial profits or which show even losses
for a number of years without
any special reason, when other banks
functioning in the same region with smaller working funds and reserves make
considerable profits. Such banks which continue to exist for various reasons
peculiar to those who run the banks cannot be taken into account to depress the
wages of the class in which such banks fall. It would be putting a premium on
the existence of unhealthy banks if they are encouraged to continue their
activities by the incentive of lower wages.
5.143.
There are various restrictive provisions contained in the Banking Companies
Act. By Section 17 it is made obligatory on a banking company incorporated in
India to create a reserve fund. A banking company is under an obligation “out
of the balance of profit of each year as disclosed in the profit and loss
account prepared under section 29 and before any dividend is declared” to
transfer to the reserve fund a sum equivalent to not less than 20
per
cent of such profit until the amount of such reserve fund together with the
amount in the shares, premium account, equals the amount of the paid-up capital
of the company.
(xvi) Prevailing Rates of Wages in Comparable Concerns (See
page174 -
175 of Desai
Ward)
5.176.
One of the important factors to be taken into account in fixing wage scale is
the prevailing rates of wages in the same or similar occupations in the same or
neighbouring localities.
5.177.
The Sastry Tribunal in considering the prevailing rates
of wages has observed that helpful comparisons could be made between wages in major
banks and those in small banks, between banks on the one hand and certain
industries on the other, between the bank awards and the awards in insurance
companies, oil companies and textile companies and that the rates of pay in
certain departments of Government such as the Posts and Telegraphs and in State
Governments would also furnish material for the construction of a pay scale for
the bank workmen. It also referred to there port of the First Pay Commission
and stated that there were several affinities between bank workmen and
Government clerks, bank subordinates and Government menials. The Sastry
Tribunal has set out the scale of pay for clerks in the service of the various
State Governments and also in the service of the Central Government. In
paragraph 260 of its award it has observed as follows:
“Or
again we may take a cross section of the wage map of India for clerical staff
and compare the prevailing rates in a mixed bag consisting of industrial
concerns, municipalities, insurance companies, government departments, Port
Trust and Reserve Bank of India.”
The
Sastry Tribunal has then set out the emoluments received at the initial start
by members of the clerical staff of various concerns in this mixed bag. It has
also given a summary of the emoluments given to clerks under the more important
award relating to various concerns.
5.178.
The Labour Appellate Tribunal after referring to the fact
that the Sastry Tribunal had set out in its award the total emoluments of a
mixed batch of industries and Government and quasi-Government institutions
stated that it had collected other material also. The Labour Appellate Tribunal
has thereafter set out the total emoluments payable to a clerk at the initial
start in28 different concerns. After considering the emoluments
payable in these
1.
Burmah Shell ---- ---- 195.00 224.65
2.
Standard - Vacuum ---- 190.00 224.65
3.
General Motors ---- ---- 170.00 — Closed down
4.
Ford Motors ---- ---- 154.56 — Closed down
5.
Glaxo Laboratories ---- 161.69 192.32
6.
Imperial Tobacco ---- ---- 195.00 225.00
7.
Hindustan Vanaspati Hindustan
8.
Lever Brothers -- LIvers 174.87
220.00
9.
United Traders
10.
Tata Oil Mills ---- ---- 154.56 178.65
11.
Volkart Brothers (Voltas) 135.00 183.60
12.
Greaves Cotton ---- ---- 154.56 193.50 (Under appeal in Supreme Court)
13.
Swastik Oil Mills ---- ---- 149.56 179.75
14.
Larsen & Toubro ---- 161.12 190.86
15.
Grahams Trading Co. ---- 154.56 168.54
16.
Imperial Chemicals ---- 139.00 176.00
17.
Tata Industries 120.00 — Not available
18.
Associated Cements ... 138.00 169.00
19.
Oriental Assurance ... 124.50 154.39
Now part of Life Insurance
Corporation
20.
Reserve Bank of India 142.50 — Under adjudication
21.
British Insulated Calenders 138.00 178.00 Cables Ltd. (Indian Cables)
22.
Bombay Gas Co. 125.00 — Not available
23.
Fortes, Forbes Campbell 151.00 161.25
Note:
- Existing dearness allowance in the concerns in Bombay is calculated
on
Bombay consumer price index slab (411-420) for February 1961 at 420 Bombay
index number when the corresponding all-India consumer price index with base as
1949, was 123.
If the method adopted by the Labour Appellate Tribunal
for the purpose of fixing the total emoluments of a clerk in an A Class bank in
Area I is adopted, there is a good case made out for revision of the emoluments
ofworkmen in the banking industry.
(xvii) New Scales
of Pay (SE PAGE 176-177 OF DESAI AWRDS)
5
179. There is considerable
material placed before me to show that as a result of the awards of
adjudicators and wage boards and agreements arrived at between employers and
employees, there has been a considerable increase in the level of total
emoluments paid by various concerns. Some of these are comparable and some are
not. By and large, they show that
there is an upward trend in wages payable both to the members of the clerical
staff and members of the subordinate staff.
5.180.
It has been strongly urged on behalf of the banks that
the Sastry Award as modified having linked the dearness allowance with the
consumer price index number has provided for an increase in the amount of wages
having regard to the increase in the cost of living and that no case exists for
any further increase in the remuneration payable to workmen. There
is no doubt that workmen are being paid more today than what they were
receiving at the time when the Labour Appellate Tribunal’s decision was
implemented. The workmen, however, contend that there is no
increase in their real wages and that, on the contrary, there is
considerable erosion in their real wages having regard to the increase in the
cost of living and the reduction in the purchasing power of money. The
arithmetical erosion that has taken place has already been set out earlier in
this chapter. A member of the clerical staff employed by an A
Class Bank in Area I in the first year of his service receives at the Index No.
123 (1949=100) by way of basic pay and dearness allowance Rs. 152.85 and Rs. 8
as house rent allowance if he is employed at Bombay and Calcutta and Rs. 6 as
house rent allowance if he is employed at other places with population over 7
lakhs. The question that arises for consideration is whether what is being
given under the Sastry Award as modified is sufficient having regard to the
changes in the circumstances that have taken place.
5.181. Having considered all aspects of
the matter, I am of the view that to the extent that prevailing rates of wages
in similar occupations in the same localities play a part in the fixation of
wages, the workmen have made out a case for an upward revision of their emoluments.
CONCLUSION (just)
1.
Today the banking industry
with nationalized banks forming
major share as a whole (unlike the award days) has immensely prospered and tremendously expanded.
2.
Cost of living
has substantially gone up throughout India.
3.
National income
under Five Year Plans has considerably increased.
4.
Prevailing rates
of wages in other industries, including government employees have also
considerably gone up. The government as model employer cannot deny justifiable
and justisiable wages at par with government employees, to bank employee alone.
5.
The existing wage scales as per the comparison shown in
the Annexure A between government and
bank employees are not at all adequate
to ensure minimum subsistence wage for the clerical and subordinate staff,
having regard to the high cost of living prevailing all over the country.
6.
Not only the rise
in the cost of living should be fully neutralized but there should be
improvement in the real standard of living of the employees.
7.
The nature of
work in the banking industry today requires greater skill, involves risks
accuracy, responsibility and hard labour than that required in other
industries.
Thus it is imperative that
bank employees are adequately compensated due to their glowing responsibility,
transferability, accountability in order to maintain high standards of honesty,
integrity as their job demands in a highly competitive and sensitive sector of
the Indian economy, in view of the following
Public sector banks practically
government institutions today as
could be seen form the additional auxiliary work performed by bank employees
which was hitherto performed by government employees and in view of the reasons
adumbrated ,adduced below
1.
All public sector banks acquired the public sector characteristic by
virtue of a special act passed by the Indian Parliament.
2.
Central Government directly and indirectly through other PSUs like LIC
of India etc. holds majority of the shareholdings in public sector banks.
3.
Several public sector banks are bankers to the government - Central or
State - either as a lender or a custodian of government funds. Public sector
banks have subscribed to several Government Promissory Notes, Treasury Bills
and Bonds and Debentures issued by State/Central PSUs.
4. Public Sector Banks have established
and manage Currency Chests throughout the country on behalf of RBI, thus
playing a vital role in currency issue and management (printing is the sole prerogative of RBI).
5.
Public Sector Banks run clearing houses throughout the country, thereby
helping the government manage the nation's economy, trade and commerce.
6.
Even today, Public Sector Banks have the majority share of the public
savings (more than 77%), enjoying the confidence and trust of most of the
common citizens.
7.
But for the low wages, public sector banks are one of the dream
destinations for thousands of aspiring youth in the country.
8.
Public Sector Banks as a group are the second largest employer, next
only to Indian Railways, providing employment to lakhs of unemployed youth.
9.
Public Sector Banks as commercial entities and the staff working in them
are one of the major contributors to government's kitty, as they are one of the
few honest tax paying groups.
10. Under the guidance and
supervision of RBI, public sector banks play a vital role in managing the
precious foreign exchange assets of the country.
11. Banking Regulation Act,
1949 and Negotiable Instruments Act, 1881 are two important Acts of Union of
India, which broadly govern the functioning of general banking in India.
12. Banking policies and
operational guidelines are broadly designed by Department of Financial
Services, Finance Ministry, Government of India and the banking industry is
monitored and controlled by the government, in association with RBI.
13. Bank Holidays are decided
by the respective State Governments and published in official gazettes.
14. Public Sector Banks issue
Bank Guarantees on behalf of ‘President of India’.
15. In 1979, Central Government
had accepted Pillai committee recommendation on the point that the Bank
officers’ salary will be equal to that of Class 1 officers. By doing this, the central government has
indirectly admitted that public sector bank employees are to be treated on
equal footing with the government employees.
16. Central government uses
PSBs for various purposes like Tax collection, implementation of socio-economic
policies of the nation viz. targeted lending (priority sector lending),
distribution of subsidies and grants, financial inclusion etc.
17. Bank employees are invited
to apply for vacancies on deputation basis in institutions like DRT, CBI,
FIU-IND, IBA etc.
18. Bank staffs are drafted for
election duties by Election Commission of India.
19. Bank Managers are empowered
to attest certain documents for limited purposes, by the government.
20. Successive Finance
Ministers have acknowledged the fact that only because of the public sector
banks in India, we as a nation could successfully insulate ourselves against
the tribulations that jolted the South East Asian Countries in the late 1990s,
the global recession that turned the economy of several American States
topsy-turvy in 2008-10 and the very recent crisis that enveloped the European
nations like Spain, Greece, Italy etc
21. .Last but not the least,
public sector banks generate very substantial revenue for the Union Government,
by way of issuance of dividend on their shares
22. volume and varieties of
work handled by bank employee are beyond comparison
23. The productivity per employee,
business per employee and branch and profitability of public sector banks ahs
enhanced many folds.
24. It is pertinent to mention here that 7th Pay Commission has
been constitute for revision of salaries of central government employees, whereas
bank employees are yet to catch the salaries they are getting as per 6th
Pay Commission report.
25. There is steep raise in CPI
inflation and the salaries in absolute terms have also been eroded. consumer
price index ahs already increased by 1501 numbers over 4440 which was
prevailing on 01-11-2012 i.e. the level at which IBA ahs agreed to merge the DA
with basic pay
26. And above all there is a danger of pouching of the existing young
and trained staff of public sector banks by new generation of private sector
bans and foreign banks which will merge
as per banking policy.
HENCE OUR
DEMAND FOR 25 % HIKE IS JUST AND RIGHT.
Even
with 25% hike we will just be inching towards some semblance of parity with
pay of government employees if we
evaluate the projected salary in anvil in the wake of 7the pay commission.
Friends
The capacity
to pay is never the standard of any capitalist when he starts an industry. They study the market some where they find the rate
of profit to be 20, somewhere 30 and some where 50. They try to cash on it and
come with their accumulated capital, reserves or some things – Rs. 5 crores or
Rs. 10 crores and put it in to much machinery, so much raw material and go on
hunting for the worker see at what will they can buy the labour power. Then
they calculate that if the labour power is purchased Rs.10 a day their rate of
profit will go down from Rs.50 to 30. So they reduce the rate. So the capacity to pay is really the
capacity to earn the highest rate of profit. And we (The trade
Union) change the wage rate up by bargaining, by organising ourselves and by
strikes. So capacity to strike determine the capacity to pay on the part of the
employer. The capacity to pay is not an abstract, unbreakable inviolable
principles. It is a determinable thing determined by the rate of profit and
capacity of the worker to bargain and strike for it. As the trade union maintain,
it is not the industry’s alleged capacity to pay that is material to urge
fixation put the workers capacity to work without which there can be no
production.
So long as there is a high volume of NPAs in banks,
there cannot be defined, expected profits .NPA is not our creation. So we cannot accept this shallow and
unfounded logic of capacity of the banks to pay. If that be the case wage hike
for government employees cannot be granted
unless The central government brings down the current account deficit to
'Zero' ,the fiscal deficit to 'Zero' (CAD was at Rs.216,000 crores for 2013-14
as per the news item in NDTV Profit on 21-05-2014. Fiscal deficit was at
Rs.519,529 Crores for 2013-14 as per the news item published in various
newspapers
If the central government
recovers a fraction of NPA which around
six lakh crores through stringent
legislations and measures and further recovers the huge tax arrears due from big
industrial houses, large corporate groups, MNCs and high net worth individuals
(HNIs), in Income Tax, Service Tax, Customs Duty, Excise Duty, Property Tax
etc. in full (Income Tax arrears alone
stood at Rs.580,000 crores as at the end of March, 2014), bank and
government employees can be easily granted just
share of value added in the forms
of just wage revisions.
In view of the aforesaid
principles laid by Indian jurisprudence , for bank employees our demand of 25 %
hike in pay slip components is fair , just meets ends of justice and should be
seized form unyielding hands no holds barred.
If
today in our anxiety to secure arrears and marginal increase in wages, we
compromise on principles in accepting their unreasonable, irrational demands,
tomorrow we will be compelled to sign on dotted lines even in matters suicidal
to our interest
This
in short is the emerging scene and engulfing situation. We know that wages or privileges we get today
are not charity of IBA. It is the
heritage and legacy of our sustained struggles and inspiring sacrifices. We have survived furious storms and gusty
winds. We know as a responsible Union,
when to organise and how to agitate. We
have the glorious past, potential present and challenging future.
Therefore let history record that in spite of the
greatest odds Bank employees irrespective of their union affiliations would stand up and resist injustice and reject
with disdain and contempt the demands of IBA
Our
response to IBA’s offer can only be our unity.
Let us demonstrate once for all that the dedication and conviction we
have in upholding our dignity cannot be high jacked by IBA nor it can be
purchased or bartered. Let the world
know our consciousness is not for sale.
We
are sure you will draw appropriate conclusions and proper decisions in this
regard.(see Annexure A)
ANNEXURE A
MONTHLY SALARY OF CENTRAL GOVERNMENT STAFF
AND BANK STAFF (OTHER THAN OFFICERS) AS ON 01-08-2013 – A COMPARISON
|
Various
Components
of
Monthly Pay
|
Central
Govt. Staff
(in Pay Band –1)
|
Sub-staff
in Banks
|
Central
Govt. Staff
(in Pay Band – 2)
|
Clerical
staff
in
Banks
|
|
Basic Pay
|
4,860
|
5,850
|
8,700
|
7,200
|
|
Grade Pay
|
1,800
|
N I L
|
4,200
|
N I L
|
|
Special Pay (at the minimum for
bank staff)
|
N I L
|
340
|
N I L
|
500
|
|
Total
|
6,660
|
6,190
|
12,900
|
7,700
|
|
Dearness Allowance
|
5,994
(@90%)
|
5,506
(@88.95%)
|
11,610
|
6,849
|
|
H.R.A.
|
1,998
(@30%)
|
619
(@10%)
|
3,870
|
770
|
|
C.C.A.
|
N I L
|
N I L
|
N I L
|
N I L
|
|
Education Allowance
(maximum for 2
children)
|
2,500
|
500
|
2,500
|
500
|
|
Transport Allowance
|
1,140
(600+90% DA)
|
225
|
3,040
(1,600+90% DA)
|
225
|
|
Staff Welfare/Provisions
|
N I L
|
500
|
N I L
|
500
|
|
Newspaper
|
N I L
|
100
|
N I L
|
100
|
|
Gross
Monthly salary
|
18,292
|
13,640
|
33,920
|
16,644
|
|
‘now
at least let them not mourn
and
allege Bank employees earn.
more
than they yearn
statistics
they should learn”
|
|
“Low Wages and High
Productivity is EXPLOITATION
Low Productivity and High Wages is CHARITY
Low Wages and Low Productivity is SUICIDE
High Wages and High Productivity is
PROSPERITY”
|
To be continued……
Email: ambujchinu@gmail.com
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