Variable pay is well-accepted across industries including private banks, but not in public sector banks.The Indian Banks’ Association’s (IBA) wage negotiation committee has come up with this proposal last Friday and leading bank unions negotiating wage revision have readily accepted it in-principle, according to three people familiar with the development. The wage negotiation committee is headed by Union Bank of India managing director Rajkiran Rai.PLI may be computed annually after declaration of banks’ annual results while bipartite wage settlement takes place every five years. But the new structure would be different as it would be based on performance of banks and not on individual employees.“United Forum of Bank Unions has in-principle agreed to PLI as this will make a uniform incentive structure across public sector banks. But the modalities need to be worked out,” said Rajen Nagar, president at All India Bank Employees Association. But bank unions did not agree to RoA as a parameter because they say that ROA depends on the quantum of provisions and can turn negative even after making operating profit.

Source: Economic Times November 18, 2019 15:24 UTC