Salary Increase in Government Banks

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salary increase in government banks

Salary Increase in Government Banks

Increase of Salary for all employees of Government banks which include Nationalized banks and Regional Rural banks is due since November 2017. For the purpose of wage settlement IBA and Bank Unions have held many meets till date in which IBA has offered a maximum of 10% hike in salaries and has proposed linking of hike pay to profitability and Return on Asset of the bank which has been outrightly opposed by Bank Unions, which has sticked to equal pay for bank staff. Currently starting salaries of all bank employees (except SBI) in the bank are equal according to their cadre. For e.g. starting basic of a probationary officer in a Indian bank is 23700 is same to that of a probationary officer in Punjab National Bank. In case of SBI staff get 4 increments extra than that of a staff of PSB. Bank employees have gone on a strike of 2 days for the purpose till now though it is expected that we can witness a number of strikes in coming days since settlement between IBA and UBFU (bank union) is not in sight.

What is the Provisioning done by banks on account of wage revision?

Banks since November 2017 have starting to do provisioning in anticipation of wage settlement. According to sources in different banks, banks are creating provisions according to a 12% hike in salaries.

What is Provisioning?

As soon as wage settlement is done, banks will have to give their staff arrears of salary difference from November 2017. This would mean a hug amount of arrears is to be paid. Banks keep on doing provisioning (keeping money aside) so that no excess load of wage settlement is seen on bank’s performance.

What are the expectations of wage settlement this time?

As discussed earlier till now IBA has offered a salary hike of 10% only. But we are hopeful of a respectful bank settlement of around 14%. We are also hopeful that a call for making all Saturday off will be accepted.

Does salary increases on a yearly basis?

Bank Settlement is done every 5 years. Like last settlement was applicable since November 2012, this will be applicable since November 2017 and Next will be due from November 2022. But yes bank salary also increases on a yearly basis. Every employee of the bank is entitled to annual increment according to their position (clerical, scale I, II, III, IV etc). Along with annual increment Dearness Allowance (linked to inflation) chances every 3 months and on an average results in increase of banking salaries by about 5% every year. On an average due to annual increment and increase in dearness allowance average banking salary increases by around 5% annually. Other than this there are 2 exams which give you 2 extra increments i.e. JAIIB and CAIIB. 

Does Regional Rural Banks and Public Sector Banks have the same salary?

Yes the basic salary of employees of both regional rural banks and public sector banks. What changes is amount of HRA allowance (maximum HRA allowance in RRB is 7% where as it is 10% in PSB’s) and perks.

National Pension Scheme in Regional Rural banks

Pros and Cons of Joining RRBs

What was the Percentage of settlement of last wage revision?

According to wage settlement November 2012, wage hike in banks was around 14%. In wage settlement November 2012, second and Forth Saturday of the month were declared Holiday.

If wage settlement is at 12% what will be the gross salary of Bank Staff

Average Salary* of Clerk: (current basic: 11765)

PSB SBI
26000 29000

 

Average Salary* of Probationary Officer Scale 1: (Current Basic 23700)

PSB/RRB SBI
44000 50000

 

Average Salary* of Probationary Officer Scale II (Current Basic 31705)

PSB/RRB SBI
62000 71000

 

Average Salary* of Probationary Officer Scale III (Current Basic 42020)

PSB/RRB SBI
79000 88000

*Average Salary = (basic Pay + Dearness Allowance + Special Allowance)