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Tuesday, February 11, 2014

Banking services paralysed on Monday as employees begin 2-day strike

Banking services were crippled on Monday as bank employees across regions begun a two day strike rejecting Indian Banks' Associations 10% hike offer.

Wage revision in public sector banks is due since November 2012. At the last tripartite wage settlement in 2007 which expired in October 2012, bank employees received a 17.5% hike.

United Forum of Bank Unions said over 10 lakh employees have joined the strike in 27 public sector banks and 48 regional rural banks.

However, Finance Minister P Chidambaram said the profit of banks cannot be used only to enhance salaries because there are other obligations.

IBA which represents bank managements in wage settlement talks with unions is reported to have said that banks can not afford more than 10% salary hike due to steep growth in non-performing assets putting pressure on profitability. A 10% hike would cost banks an additional Rs 3,150 crore a year cumulatively.

Union members in turn said offer was not in line with rising inflation. Their demands include regulated working hours for officers, five days a week and re-introduction of compassionate ground appointment.

"Some Rs 1.41 lakh crore has been written off in the last five years and the banks are sitting on over Rs 6 lakh crore bad loans because of managements' negligence. But they are not ready to pay staffs a reasonable hike," said Rajen Nagar, president of All India Bank Employees Association, the largest bank union representing almost half of 10 lakh bank employees including officers and subordinated staff.

The Finance Minister said that a significant part of retained earnings must be used to infuse additional capital, otherwise banks will not find the amount of capital that is required over the next five, 10 and 20 years.

"I will appeal to employees and officers of banks to recognise that banks profits, banks earnings have other claims. While claims of officers, staff and employees must be duly acknowledged, and a fair and just (wage) settlement is arrived at, there are other claimants to banks' profit," Chidambaram was quoted saying in a PTI report.

Source: Economic Times


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