Probable Wage Structure In Bipartite Settlement

"THE EMPEROR'S NEW CLOTHES"

  ".... two weavers who promise an emperor a new suit of clothes that they say is invisible to those who are unfit for their positions, stupid, or incompetent – while in reality, they make no clothes at all, making everyone believe the clothes are invisible to them. When the emperor parades before his subjects in his new "clothes", no one dares to say that they do not see any suit of clothes on him for fear that they will be seen as stupid. Finally a child cries out, "But he isn't wearing anything at all!"

Some salient features of 15% rise demand and 2.25% loading:

1.  Tentative wage bill of 3/17    Rs.53000 cr

2.     Of which 15% it comes to Rs.7950 cr.

3.     Officers                             Rs.30300 cr

        Award staff.                      Rs.22700 cr=      Rs.53000 cr

4.     Officers.                            Rs. 4545 cr

        Award staff.                      Rs. 3405 cr=       Rs.7950 cr.

    Officer: Award Staff Ratio: 57 :43

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NEW PAY & ALLOWANCE

Subordinate:

                 Existing   Revised   2.5% loaded

Basic.                       9565               14137           14445

DA.                           4936                   376               385

Spl Pay.                      741                 1096            1220

DA on SP.                   383                     29                30

Total:.                      15624               15638          15990

Less NPS.                 1562                 1564            1599

Net Salary               14062.              14074           14381

Old pay.        .                                                      - 14062 

Net gain.                                                                  =319           

Clerks:

Basic.         12750.      17374.   17776

DA.                6066.          462.       473

Spl allow.        911         1346.     1377

D.A. on SA.     470.            36.         37

Total:.          19992.      19218.   19651

Less NPS.     1920.        1922.    1965

Net Salary.  17282.      17296.  17686

Old pay.                                    -17282

Net gain.                                      =404

Officers:

Basic.          23700.      35029.   35817

DA.               22229.          932.        953

Spl Aloo.        1837.        2715.     2776

DA on SA.        948.             72.         74

Total:.          38714.       38747.    39619

Less NPS.     3871.         3875.      3962

Net Salary:  34842.       34873.     35657

Old pay                                         -34842

Net gain.                                          =815

Pay slip components consist of Basic Pay, Spl Pay, Spl. Allowance , DA, Educational Pay, HRA, HRA on bills, HRA on capital loss, CCA, Conveyance, annual medical reimbursement.

With 2.25% loading 15%  rise results in net gain at bottom level Rs.319/=, Rs.404/= & Rs.815/= for subordinates, clerks & officers respectively per month.

We don't think Bank men have any reason to smile. Better to this, they got in Feb.2020 in DA rise, compensation to real wage loss in inflation in Oct-Dec 2019,  3 months. DA doesn't compensate inflation in real sense, due to inherent faults and inconsistencies in price indexes. So, this is taken due care when wage revision takes place periodically.

Bank men suffered hugely due to their own faulty methods, their Unions adopted linking wage increase to swapping DA in Basic, reducing future %age of DA on remaining and rising indices . Proper was to Swap DA with basic then give it proper load with continuing old DA rate on remaining & rising indices. Do it and see the difference. Nobody is prepared to listen where they went wrong. 

If someone raise finger, it is taken as blashphemy. Very dangerous notion being followed is: king does no wrong. Take 15% rise as just lollypop. In effect,  rise is just 2.25%. 

People were required to look into the methods that Pay Commissions, Judicial Commissions or other PS enterprises adopt, but it's useless now. There have been huge cry right from CPC recommend arvind of 2006. It became more koi der by 2016 CPC Recommendations. 

People cried of need to have PC for Bank men. Literally, CPC meant, to follow methods of CPC. But, Bank men are made to believe in 'The Emperor's New Clothes' a short Danish tale by Hans Christian Anderson, gist given as above. 

Here, in bank men case, there are 9 weavers, befooling entire banking fraternity by making everyone believe, 15% rise is like 'the Emperor's new clothes', but invisible and if one does'nt believe, he is unfit for his position, stupid and incompetent. 

(J. N. Shukla)

National Convenor,

Forum of Bank  Pensioner Activist

Prayagraj 211 004

'The Emperor's New Clothes'


Clarification  on, 16.02.2020

Some of readers have raised their doubt about the correctness of the figures given in the write ups titled above. It's from very reliable source, AINBOF. Further, it pertains to Basic, DA, Special Pay/allowance only. Many items like HRA, CCA, Conveyance, medical aid etc are not included in it. 

One can fairly look to 10% over all gross increase according to our rough idea. Allocated fund distribution has always been wrong in past. Seniors, with a view to increase their Basic so as to get more Pension, were always given more considerations than new comers. It's another reason that a new joinee finds his pay low. Gap too widened between Clerk-officer. This will repeat again. 

Universal principle has been: higher the pay, lesser growth percentage and lesser the pay, greater  growth percentage. It is a celebrated and ideal principle to reduce gap and to ensure living wage at bottom side  Unions have ignored it in last several settlements & did in  reverse that caused low pay out to young employees/officers. Same problem is in DA. Low basic low DA increase, higher basic higher DA increase. Consumption pattern is different, so DA percentage must be different to equate people in low & high pay brakets.

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In  conciliation meeting held on 14.02.2020 , CLC advised the IBA to call the unions for negotiations immediately and conduct the meetings fortnightly on regular basis to finalise wage revision at the earliest. IBA offered to hold the meeting on 17th. Further decision on the strike action depends on the outcome of the meeting. IBA has fixed the BP meeting on 17th at 11.30 at Mumbai. UFBU will meet at 8.30 on 17th before going to IBA meeting.

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I produce below what ALL INDIA NATIONALISED BANKS OFFICERS’ FEDERATION  has clarified on various aspects of wage settlement processes.

Ref : GS / JAN / 2020 / 8 / BPS 

To

All Affiliates 

DATE :14.02.2020 

Dear friends, 

Few Facts about Wage Revision & Wage Negotiations 

There are widespread concerns and confusion among the youth on the Wage Revision. This communication is intended to dispel the doubts in their mind and clarify how wage revision happens and wages are fixed. 

14 Large banks were nationalized during first round of nationalization in 1969 and another six banks were nationalized in the second round in 1980.

As there was no uniformity in the salary and salary structure of Bank officers Pillai Committee was formed to rationalize the Salary of the officers in the nationalized banks.

While rationalizing Pillai committee fixed the basic pay of Scale I officer as Rs.700/- which was the Basic Pay drawn by a Grade A Officer of Government of India.

The first settlement for workmen / award staff was signed on 19.10.1966, Second on 12.10.1970 and the third settlement was signed on 31.10.1979.

Since, the workmen / award staff were governed by Industrial Disputes Act, the settlement so signed will be effective from the date of the agreement.

As far as the officers are concerned the settlements are signed in the form of Joint Notes which will come into effect after completion of the statutory requirements like amendment of Service Regulations by Government of India.

First Joint note of Officers was signed in 1985 with effect from 01.02.1984 and it was the fourth settlement for the workmen.

The three previous settlements for Officers were signed separately through independent negotiations.

During seventh Bipartite Settlement UFBU was formed and the Joint Charter of demands was submitted.

10.There after 8th, 9th and 10th Bipartite settlements were negotiated and clinched by UFBU. 

11.The method adopted in the tenth Bipartite Settlement and is being discussed now for the Eleventh BPS is 

-  As a first step the UFBU and IBA decides the date of implementation. In the 11th BPS it is already mutually agreed as 01.11.2017.

-  Second step is to arrive at the common point of merger of DA with Basic Pay. Normally the DA prevailing one year before the due date is reckoned like if the due date of settlement is 01.11.2017, the DA as on 31.10.16 is considered to be merged. In the current negotiations it is likely that the merger of DA as on 31.10.2016 i.e. 47.80% or 478 slabs / 6352 points is going to happen.

-  For the purpose of calculating the cost of Wage Revision the establishment expenses as per the ABS for the immediate preceding Financial Year to the year in which the revision is taken into account. Accordingly for the present wage revision due on 01.11.2017, the ABS as on 31.03.2017 will be taken for consideration.

-  Till 9th Bipartite Settlement the COST was taken based on the Total Establishment Expenses. But from Tenth Bipartite onwards i.e. 01.11.2012, the total COST of Wage Revision is taken on the Total Payslip Components, which are listed as below, instead of Total Establishment Expenses.

-  The components of Payslip Components are

     • Basic Pay , Special Pay for Performance of duties,  Special Pay for Educational Qualifications ,  Dearness Allowance (DA) ,  House Rent Allowance (HRA) ,  HRA on production of Rent Receipt ,  HRA on Capital Cost ,  City Compensatory Allowance ,  Any Conveyance Allowance disbursed along with Salary ,  Annual Medical Reimbursement 

• -  During the negotiations the percentage of increase is not decided but absolute amount affordable for Payslip Components is decided which is expressed in terms of percentage
  
• 
  
• -  The absolute amount which is arrived in this manner which denotes the certain percentage of the Total Payslip Components is divided between the Employees and Officers in proportion to the Fixed Pay components as on March of the year in which the Wage Revision is due.
  
• 
  
• -  The percentage that is being negotiated in the current BPS started from 2% offer by IBA initially and now it is 15% against the UFBU demand of 20% to arrive at the absolute amount i.e. COST of Wage Revision
  
• 
  
• -  The Total Payslip Component as on 31.03.2017 was indicated as Rs.53000 Crores approximately and 15% of this amount is Rs.7950 Crores and this absolute amount is like to be divided among Workmen and Officers approximately in the ratio of 43:57. The amount so divided will be loaded into the various payslip components as given earlier and any balance left out will be loaded to other allowances.
  
• 
  
• -  The likely impact on the Wage Revision on the basis of the 15% offer with 2.25% loading in Basic Pay will be as below
  

Payslip Components – Officers            Rs.30300 Crores 

                                    – Award Staff    Rs.22700 Crores 

Total Payslip Components (Approx)     Rs.53000 Crores 

Absolute Amount available at 15% COST  Rs. 7950 Crores 

COST for Officers (30300/53000) *7950                             Rs. 4545 Crores 

COST for Award Staff Share (22700/53000) *7950           Rs. 3405 Crores 

-  Further, Government of India has increased NPS deduction to 14% from the existing 10% which is one of our demands also. In case it is accepted it will have additional impact on the salary receivable. 

Because of such reasons only AINBOF has been demanding right from the beginning that the Wage Revision should be based on the Minimum Wages Formula which ensures that the salary should be matching to the status of the employee in the organization without linking to profit or paying capacity and to enable him to lead a decent life. This same formula was adopted in the Seventh Central Pay Commission and demanded in the Charter of Demands submitted by Four Officer Organizations.
The writ petitions filed in the High Court demanding the Wage Revision on the above lines were admitted by the Judiciary in view of the justifications and merits in the Case. 

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The Government of India has also supported the Minimum Wages Policy by passing the Code on Wages Act, 2019 covering the employees in the organized and unorganized sector. Replying to an RTI Query on the applicability of the above Act for Bank employees, Ministry of Labour and Employment (MoLE) had replied that the Code on Wages Act 2019 universalizes the provisions of minimum wages to all employees and it will come into effect on the date the provisions are notified by the Central Government. 

Indian Banks Association’s (IBA) had submitted a Counter affidavit in the Madurai High Court on the Writ Petition, stating that they are only facilitators and not the authorized persons to decide on the Wage Revision which itself is a proof for the justice in our demand both logically and legally. 

On a case related to payment of Pension, Hon’ble Supreme Court has ruled that PENSION is a right and not a bounty. The most important aspect of the judgement is that no plea of financial burden should be taken to deny the legitimate dues of the pensioners. 

Also RTI queries by bank retirees forum has revealed that the accumulated pension fund is around Rs.2.40 lakhs Crores whereas the total amount disbursed as pension in the year 2017-18 was Rs.14800 Crores only against the interested earned in the corpus fund of Rs.18400 Crores. This clearly proves that there is sufficient scope for improving the pension and also family pension benefitting lakhs of pensioners. 

The ever increasing premium in medical insurance scheme brought out during Tenth Bipartite Settlement has left many pensioners poorer and put the scheme beyond the affordability of others. The Medical Insurance Scheme has miserably failed in its inclusiveness and the pensioners who have joined this scheme foregoing their existing scheme are left to repent their decision of switching over. 

Friends, 

We are on right path and our demands are just and valid. We are also not wavering in our demands on whims and fancies. From the beginning of Wage Revision negotiations we are clear in our demand and standing steadfast on them. 

Our apprehensions have come true as even with 15% increase in the COST of Wage Revision on the Total Payslip Components coupled with a loading of mere 2.25%, our Basic Pay is not increasing much dealing a big blow for the retirees and those who are on the verge of retirement. 

Even in the case of IBA accepting the offer of 20% as demanded by UFBU, without effecting any change in the Merger of DA points from 6352 slabs or increasing the load from the 2.25%, there will not be any significant increase on the revised Basic Pay after merger of DA as is proposed now. 

Hence AINBOF is demanding 

• -  Basic wages as per the ILO prescribed minimum wages formula.
  
• -  Salary of the JMG scale I Officers should be equivalent to Grade “A” officers
  of the Govt. of India.
  
• -  Running scale of pay without any stagnation.
  
• -  Updation of pension, increase in Family Pension and upward revision of Ex-
  gratia amount for pre-1986 retirees and surviving spouses
  
• -  Medical Insurance Scheme matching to the scheme offered in SBI 
• 
  We request you to write to us at ainbof@gmail.com in case you are having any clarifications, doubts, suggestions, feedback which you are not able to get clarified from your organization.