Progress In Wage Talk Disheartening

IBA has again tried to introduce CTC / performance linked pay PLP /incentive based performance IBP concept in wage revision . In banking industry , use of CTC /PLP/ IBP concept will lead to more fraud, more flattery and more misuse of power and all these at the cost of the organisation and performing workforce attached to it. 
CTC is used by management to build pressure on Trade unions to accept lesser wage hike whereas PLP and IBP are used by top officials to award yesmen in disguise and isolate honest performers from promotion process. Similarly merit oriented promotion policy is framed to reject good officers and select yesman and flatterers.
PSU banks are already suffering due to misuse of merit oriented promotion policy in vogue for last three decades , misuse of committee approach for sanctioning of loan proposals and for purchase of goods  services in bank and finally misuse of  recruitment body like IBPS and campus recruitment in special category.  And   now if the proposed concept of Cost to Company (CTC) / PLP / IBP is insisted upon by IBA and if trade unions agree to it under pressure or under bargaining , it will be  nothing but an attempt to commit suicide.
Banks will not prosper but few flatterers will go up the ladder and genuine performers will become victim of the corrupt culture prevalent in top offices.

It is open secret that top officials in all government organizations use their power to twist rules as per their whims and fancies to favour an employee to whom they like, who gives them money or who is a perfect Yesman.Bankingg industry is a service oriented industry and the quality of service cannot be measured by any full proof yardstick. It depends of whims and fancies of top officials how they perceive a person and what work culture they prefer.

Performance of a staff depends not fully on his knowledge and efficiency but also depends on other factors such as place of posting, quality and quantity of supporting staff, potential of place for business development, age of branch , volume of litigation in the branch , political sensitivity of the area, crime situation of the area etc.
If an officer has to be awarded, he will be posted at the most suitable branch and supported by more than adequate number of good staff so that he may produce desired and better progress in allotted parameters of progress .

On the contrary if an officer is not a flatterer , he will be posted at a dry place where subordinate officers and staff working under him will be of inferior quality and he will fail in his task . Failure may be due to political interferences, local crime groups , deficiency in infrastructure and other uncontrollable factors too. Performance of clerical staff and peons is on the same line and cannot be measured correctly by any honest and trustworthy tool.
 Even now , we bankers have got experience how insurance products is sold to big customers at the cost of credit quality and the prize thus won is enjoyed by top executives. Most of insurance business is procured by selling to big borrowers . Marketing officers thus achieve the target and get the price. But loans and advances given to such unscrupulous borrowers many times become bad . In this way though bank earn a few crore of rupees as commission by selling insurance products whereas lose many crores of rupees when the loan become Non Performing Assets and become irrecoverable. This culture matches with a proverb, " Penny wise and pound foolish".
If one make analysis of NPA of PSU banks as on 3103.2017 , it will become clear that more than 90 percent of NPA accounts relate to big borrowers who more often than not oblige marketing officers by investing small amount in insurance products . Bank officers for the sake of earning commission and incentives give more value to selling the policy than to quality of advance and other products where incentives is not attached or where earning of incentives is not easy .

I am of strong opinion , bank union should not only put a final stop on all types of incentives but also completely abolish merit oriented promotion policy and insist for absolute seniority based promotion. It is also true that in case of automatic promotion, some staff will not work to the extent they are supposed to be . In such case bank should devise a transparent and acceptable formula to monetarily penalise inefficiency of such staff. 
But so far as merit oriented promotion policy is concerned, it appears as if the policy awards real performers, but it is completely a myth, it more often than not awards only flatterers and bribe earners who share bribe with their bosses. 
Experience shows that bank management uses the tool of Interview ( which is very important part of  merit oriented promotion processes ) to make or mar the career of a staff not in the interest of the organisation but in the interest of self motivated evil motives.
 In case of interview, it is complete and absolute power of interview board ( consisting of two to three members ) to give an officer 0 (zero) out of 25 mark or 25 out of 25. Panel can ask irrelevant questions to declare a candidate fail whereas on the contrary the same panel can give a non-performer 25 out of 25 marks in interview to see him successful.

Moreover different panels for conducting interview at different places have different perception and conception of good work. In addition,there is no power on this earth who can measure quality of an officer in 2 to 3 minutes of interview. If the management of a bank cannot assess the quality of an officer in 10 to 30 years of real work performance, how a interviewer can judge a officer in 2 minutes of interview.

There is no doubt to me that Interview is completely a fraud with workforce and it must be stopped immediately to save banks from disaster. IN the long run this lead to culture of flattery and bribery and cause huge loss to the organisation. In fact bank is victim of this dirty culture to a great extent. 
Similarly , the idea of cost to company for service oriented industry like bank will prove to be another fraud and injustice with performing bank staff.  There is no doubt to me. If someone has doubt, he or she may just peep into records of incentive oriented policies already in vogue in some banks , may find out whether the incentive has gone to genuine performer or has gone to some manipulators . In the same way , records of last three decades will make it crystal clear to anyone who peeps into HR records of any bank that promotion is an award for flatterers , bribe earners and bribe sharers and more often than not real performers are victim of the system.
Last but not the least , banks profit cannot go up by curtaining wages of workers , rather it will go up by enhancing the wages of bank employees accompanied by tough conduct rules and their compliance. Wages should be increased at least 10% every year and at the same time non performing employees must be taken to task without delay but in a transparent and acceptable way. Bankers who perform their duty well should be happy to such an extent that a bank employee  cannot dream of resorting to unfair practices. 
Bank's profit has gone down or is not upto the mark largely due to exploitation of banks by politicians for vote bank , due to inefficient judiciary, due to ill-motivated administrative and police officers who instead of helping bankers in recovery of bad loans put hurdles in the path of recovery. 

Banks profit is going down and down due to loan mela culture and due to waiver of loan culture propagated by all governments. Loan mela culture started in eighties from the time of  Dy FM Janardhan Pujari and continuing since then in some form or the other. Similarly evil culture of loan waiver started by Devi Lal in Haryana has been used from time to time by every political party for the sake of their vote bank. 

Unfortunately , bankers become helpless when politicians take a decision to write off  any type of loan , rather they have to work hard in motivating a borrower to repay in time. This culture of pressure lending or waiver of loan results in credit indiscipline. 

Loan waiver occurs not only in case of small farmers or traders but also in case of big borrowers in the name of One Time Settlement (OTS or say Compromise settlement ). Hundreds and thousands of crores of rupees are sacrificed every year by every bank in OTS  and this sacrifice is hundred times more than what is sacrificed in the name of small loan waiver schemes.

Banks suffer loss and their volume of bad loans rise due to  lending decisions taken by unskilled and corrupt officers and many times under pressure of some VIP or the other. Ninety nine percentage of bad loans are sanctioned by a team of senior officers and senior executive ,sometimes under verbal irders if ministers and other VIPs. Top officials in PSU banks reach at top positions through evil ways and they teach evil ways to their juniors. A culture of flattery and bribery gets propagated and promoted.

Banks suffer losses due to ill-motivated auditors and Chartered Accountants who for the sake of money conceal negative points of a company and prepare a rosy balance sheet by manipulating figures.

It is therefore need of the hour to understand the root causes of rising bad debts and continuous erosion in profit and profitability of PSU banks. Government cannot cure the illness caused by bad debts by merger and consolidation of banks. Process of merger may give temporary relief to some banks for few months only. Ultimately it is the attitude , honesty , integrity , knowledge and skill and finally the culture of  bankers, politicians , administrative officers , judicial officers, police officers and auditors which are more important than the number of banks . 

We cannot put blame for rise in volume of NPA totally on bankers , we have to punish more to politicians who has damaged banks due to their dirty games and who has been consistently and relentlessly using Public sector banks to serve their self interest  only, sometimes personal and some time party interest.. 

We have to make legal system constructed  for recovery of  bank loans so much quick, active and effective that a borrower cannot dream of defaulting in repayment of loan .We should introspect and ponder over the facts why lacs of cases related to recovery of loans from bad borrowers have been pending for action for decades in various courts. Why decrees granted by various courts and DRTs are not executed for years. Why certificate cases are not attended by district level certificate officers for years and decades. And so on.

Therefore it will be totally inappropriate and unjustified to penalise bank employees by introducing Cost to Company concept in wage revision . Here it is worthwhile to mention that government is not talking of CTC concept in case of BSNL, Indian Airlines and many many other loss making Public Sector undertakings. Government never suggest CTC concept for central government employees. 

In case of central government employees, there is provision of time bound promotions and there is no word like stagnation . Pay scale for central government employees has got no place for stagnation increments as it has been  persisting in PSU banks for years and decades. Not giving increments to seniors is just penalising experience and seniority. If they cannot give promotion to everyone, they do not have any right to snatch the  increment of senior employees in the name of stagnation increment. 

This is also one of big reasons behind bank's present sickness that seniors were demotivated , that seniors faced humiliation in the hands of juniors for no reason and that seniors were rejected in promotion processes just to give favour to few flatterers despite  all shortcomings in such flatterers and bribe earners.

It is pity that for last two to three decades , many ministers and many RBI officials have failed to stop growing sickness in PSU banks though they always appear in public domain as if they are real well wishers and care takers of banks. Media men are also silent spectators of sickness of banks because they in general do not know even ABC of intricacies of banking and  they do not understand why volume of NPA has been increasing year after year inspite of tall claims made by top officials of containing it.

I am submitting below the progress on wage talk outlined by one of the bank unions and I have red marked those lines which spell the evil idea of IBA . 

Circular No.7/VII/2017 June 5, 2017  issued by AIBOA 

TO 

ALL UNITS / STATE COMMITTEES   Camp: Mumbai 

Comrades, 

WAGE REVISION -EXCHANGE OF CHARTER OF DEMANDS 

As you aware that the owners are anxious to settle the wage revision which is due from 1.11.2017, and to achieve this goal there were communications to the Bank managements time and again. Prior to Nationwide strike exclusively by Bankmen on 28th Feb, 2017, officers’ organisations had submitted the broad summary on 20/02/2017 to IBA. 

Following the submission, at Chennai, on 19th April, 2017, a meeting was held, in which, Com.Alok Khare, Com. M.A.Srinivasan, Com. V.Ramabhadran , Com.G.Gunasekaran and the undersigned participated in the exercise. It was the past practice to submit the Charter of demands of officers and workmen together, but, on 2nd May, 2017, it was not possible. 

In the meanwhile, to fine tune the COD, once again, a meeting was held on 1/06/2017 at INBOC office at MUMBAI, in which Com. Alok Khare, Com. V.Viswanathan and the undersigned participated. 

IBA has invited the negotiating unions for a discussion today at IBA office to take the wage talks further. Chairman of the IBA Negotiating Team, Shri.R.K.Thakkar, (UCO) Smt. Usha Ananthasubramanian, (Allahabad Bank), Shri.Prashant Kumar (SBI), Shri.V.G.Kannan, CEO IBA, Shri.Rajkumar Dy.CEO, Shri.K.S.Chauhan Vice President HR & IR, besides the members of HR Dept of IBA. CEO, IBA initiated the proceedings of the meeting and handed over the forum to Chairman, Negotiating Team, for taking the discussion further. 

After the exchange of the CODs by Officers and Workmen organisations with IBA and the IBA handing their list of demands, Chairman Negotiating team expressed that the time line mentioned in the earlier meeting should be kept in mind, present health of Industry and also the negotiations for officers shall be restricted upto Scale III. He further placed the periodicity of meeting will be every month. While supplementing the views of IBA, Smt. Usha Ananthasubramanian, emphasised that there should be a forward movement at the conclusion of the every meeting. 

Reacting to the observations made, representatives have expressed that the expectations of the workforce should be fully addressed, de-stressing of the workforce should be carried out, health of the industry is not on account of the wage 

SECOND ROUND 

cost, negotiations cannot be restricted upto Scale III, residual issues of last wage revision exercise to be resolved viz., Regulated working hours, Discipline and Appeal Regulations, Accountability Policy, 5 days a week, issues of retirees- record note, officer representatives in the Banks’ boards, comparison of wages with Pay commission, unilateral introduction of service condition by a bank, Number of representatives to be allowed to participate in the negotiation, protection from cyber- crime, and problems encountered by the employees in the Insurance backed hospitalisation scheme etc. The meeting lasted for nearly an hour. The representative of the Officers’ organisations have handed over a letter addressed to Chairman IBA pertaining to the restriction stipulated by IBA. 

MANAGEMENT ISSUES: 

[1] C2C concept to be brought in; 

[2] Rationalisation of Special Pay carrying posts. 

[3] Review of the two graduation increments; 

[4] Transfer and deployment of workmen staff; 

[5] Simultaneous conduct of departmental and judicial proceedings for workmen; 

[6] Conducting the departmental proceedings after retirement of workmen; 

[7] Premature retirement of workmen; 

[8] Outsourcing of any activity within the RBI guidelines; 

[9] Review of the automatic movement of officers from Scale I to II and also Scale II to III ; 

[10] To mark lien on NPS fund of employees to recover loss to the Bank on account of their proved misconduct. 

UFBU meet-Post discussion with IBA: 

Subsequently, the representatives of nine unions met and discussed the issues confronting the Industry as well as the collective approach on the wage revision. The meeting lasted for nearly 90 minutes with the decision to meet on a mutually convenient day for a detailed discussion to chalk out the future course of action to “Save the Banking Industry” and also “halt the attacks on jobs and job Security”. 

Awaiting for the forward movement for a collective, consensus and also achievable plan of action.

Yours Comradely, 

/S.NAGARAJAN/ 

GENERAL SECRETARY 


Next Wage Revision Negotiations
With Workmen Unions / Officers' Associations

MANAGEMENT ISSUES NC: 05.06.2017

1) Framework of compensation package on cost to company and fixed and variable pay concept for officers / workmen.

2) Rationalization of special pay carrying posts 

3) Review of two graduation increments to workmen employees

4) Transfer and deployment of workmen employees – para 536 of Sastry Award

5) Simultaneous conduct of disciplinary and criminal / judicial proceedings in case of workmen in PSBs

6) Continuing departmental proceedings post retirement in case of workmen employees. 

7) Premature retirement of a workman in public interest.

8) Outsourcing any activity as per business needs within RBI guidelines.

9) Review of existing provisions of automatic movement of officers from scale I to II and from scale II to III in pay scales without any promotion in those grades.

10) To mark lien on NPS fund of employees to recover loss to the bank on account of their proved misconduct. 

1. Framework of compensation package on cost to company and fixed and variable pay concept for officers / workmen.

1. Background

1.1 In the last bi-partite settlement / joint note dated 27.04.2010; the issue was discussed and recorded as under:

 “Management proposed that a scheme for introduction of performance linked variable pay in addition to fixed pay be considered as part of this wage revision exercise to increase efficiency in operations. After preliminary discussions, the parties agreed to pursue the matter further after finalization of this settlement, to reach a consensus.”

1.2  In October, 2012, consequent upon submission of report of HR issues by Khandelwal Committee, the Government referred certain recommendations to IBA for views / comments covering inter-alia wages / service conditions / welfare, which states as under:

 “Banks to consider variable pay / C2C as a major component of wages. In such an arrangement, Banks to have discretion to go for C2C concept.”

1.3 In response, the under noted view of 4 member committee of IBA was forwarded to Government in December, 2011. 

 “It is more than 4 decades the industry level wage revision / service conditions are being held on bi-partitism. For any change in the above format, unions and associations would need to be taken into confidence for incorporating changes. The concept of variable pay was discussed at the last wage negotiation (9th BPS) and it was decided to take the dialogue forward with a view to come to an understanding in the next wage settlement. The committee, however, felt that new recruits will be appointed on C2C basis and the same could be offered as optional package for existing employees.”

2. Coverage of cost to company / fixed and variable pay
2.1 “ Cost to Company “ can be defined as the total cost that an organization is spending towards each of its employee including salary, monetary perks, cost related to benefits, cost related to hiring, training, retrials, statutory contributions etc. 

3. The issue of introduction of cost to company and fixed and variable pay concept were discussed, in consultation with an accredited HR consultant firm, in the last settlement / joint note, which was strongly rejected by the unions / associations. 

2. Rationalization of special pay carrying posts

The no. of special pay posts to be further rationalized and the roles/responsibilities to be enhanced to improve upon operational efficiencies.

In the changed banking scenario the utility of special assistant/continuing of the post may be examined. Also, increasing the power of single window operator B may be examined.

The special pay drawing post of daftary among subordinate staff may be discontinued and all the members of subordinate staff shall do the duties of daftary as per suitability.

3. Review of two graduation increments to workmen employees

In terms of para 121 of Sastry Award, clerical staff were entitled to increments for graduastion (two increments at the start if they are already graduates or later, on graduation while in service). The Desai Award substituted the increments by a special allowance. The increments were however, reintroduced in the 1st Bipartite Settlement dated 19.10.1966. The increments for graduation were once again substituted by a special allowance by the Bipartite Settlement dated 10.04.1989. The Bipartite settlement dated 29.06.1990 reintroduced the increment for graduation wef. 01.07.1990. Accordingly, two increments are being given to clerical staff at the start if they are already  graduates or later, on graduation while in service.

Now, the minimum qualification of the clerical staff in Public Sector Banks is Graduation or equivalent as advised by the Ministry's (DFS) letter no. 10/30/3/2012-IR dated 04.10.2012. As such, increments in lieu of graduation are to be reviewed.

4. Transfer and Deployment of workmen employees –para 536 of Sastry Award

Clause 32 of 8th Bipartite Settlement provides for deployment of non- subordinate staff within a district or up to a distance of 100 kilometers from the employees present place of posting.

Majority of the banks that were parties to the settlement found it very difficult to implement the same for various reasons with particular reference to absence of clarity between transfer as in para 536 of the Sastry Award and deployment as stated in 8th Bipartite Settlement.

It is, therefore, proposed that in suppression of clause no. 32 of 8th Bipartite Settlement, Banks to invoke provisions under para 536 of the Sastry Award which provides as under:

“In general, the policy should be to limit the transfers to the minimum consistent with banking needs and efficiency. As far as members of the subordinate establishment are concerned,  there should be no transfers ordinarily and if there are any transfer at all, they should not be beyond the language area of the person so transferred. Even in the case of workmen not belonging to the subordinate staff as far as possible there should be no transfer outside the state or the language areas in which an employee has been serving except of course, with his consent. In all cases, the no. of transfers to which a workman is subject should be strictly limited and normally should not be more than once in a year.”

5. Simultaneous conduct of Disciplinary and Criminal/Judicial proceedings in case of workmen in PSBs

In so far as an officer employee is concerned, the discipline and appeal regulations do not have any prohibitory provisions on such simultaneous proceedings. However, instances of officers bringing stay orders from High Courts on such departmental proceeding during pendency of criminal proceedings are many.

In the case of workmen, however, in view of para 521 (3) of Sastry Award/clause 4 of Bipartite Settlement dated 10.04.2002 certain constraints are placed on such simultaneous conduct of disciplinary and criminal proceedings.

It is therefore, desired that clause 4 of the Bipartite Settlement dated 10.04.2002 be modified.

6. Continuing departmental proceedings post- retirement in case of workmen employees.

Bank (employees' ) pension regulations preclude the payment of final retirement benefit (except his own contribution to CPF) to a member of the pension fund against whom any departmental proceedings continue on the date of his attaining the age of superannuation, till the conclusion of the proceedings. However, in case of an employee who is the member of the Provident Fund, departmental proceedings instituted while in service abates on his attaining the age of superannuation and the employee has to be paid all his retirement benefits. Consequent upon introduction and coverage of new recruitees on or after 01.04.2010 under new pension scheme (NPS) who will not be covered under bank employees pension regulations, 1995 has created a dichotomy among same class of employees. As such, it is a very logical issue to crystallize in the new settlement.

7. Premature retirement of a workman in public interest

1. Para XIII of the Bipartite Settlement dated 17.09.1984, for banks other than State Bank of India, reads as follows:

“After a workman has reached the age of 57 years, he may be retired after giving him two months notice in writing in case his efficiency is found by the employer to have been impaired. Subject to this rules and also subject to any rule under an existing pension fund, a workman shall not be compelled to retire before his 60 years old nor will it be necessary to give a workman a letter extending his service till he is 60 years old.”

2. It is proposed to modify the above provisions of para XIII of Bipartite Settlement dated 17.09.1984 to provide for premature retirement of a workman, in public interest, on or at any time after completion of 55 years of age or 30 years of service, whichever is earlier.

8. Outsourcing any activity as per business needs within RBI guidelines.

Specific provisions to be inserted in the settlement for allowing outsourcing in any activity in banks without any restrictions as per its business needs, within RBI guidelines. Outsourcing has emerged as an effective strategy for reduction in cost of products and services and outsourcing is steadily emerging as an industry.

9. Review of existing provisions of automatic movement of officers from scale I to II and from scale II to III in pay scales without any promotion in those grades.


10. To mark lien on NPS Fund of employees to recover loss to the bank on account of their proved misconduct.