Thirty months since the negotiation started, the 9th bipartite agreement between the Indian Banks Association (IBA) and nine bank-employee unions has been signed, settling the long-pending demands for wage revision. Both the sides had earlier agreed for a 17.5% rise on the wage bill over the package as existed in March 2007.

Consequent to this agreement, the pay packages, including allowances of the bank staffers, have been revised and increased. The arrears of the emoluments would be payable from November 2007.

The agreement covers all the 26 public , 12 private and eight foreign banks. The agreement will be effective for a five-year period with effect from November 2007.

The agreement will benefit 7,75,000 employees and officers and would cost the banks an additional wage bill of about Rs 5,200 crore annually (Rs 4,816 crore for PSBs and Rs 400 crore for the private and foreign banks).

It also provides for extending another option on pension to about 2,60,000 existing and 50,000 retired bank stafffers who can join the existing defined benefit pension scheme in lieu of contributory provident fund.

However, the employees and officers who join the banks from April, 2010, would be governed by contributory pension scheme as is available to the government employees.

Talking to FE, MV Nair, chairman, Indian Banks? Association (IBA), said, ?It is a historic agreement which will benefit 7.5 lakh bank employees. In the process, the compensation for PSB employees will now be comparable with their private sector counterparts and thus we at PSBs will be able to attract more talents. Nair, who is also the chairman & managing director of Union Bank of India, maintained that the outsourcing part was not discussed during the agreement.

As per the agreement, the revised pay scales for an officer (Scale I to Scale VII) will vary in the range of Rs 14,500 to Rs 52,000. Similarly, for the clerks, it will vary from Rs 7,200 to Rs 24,900. In the case of subordinate staff, the pay scale will vary from Rs 5,850 to Rs 11,350. Talking to FE, CH Venkatachalam, convener of United Forum of Bank Unions, said that existing provident fund optees will get the pension after contributing 2.8 times of revised pay as on November, 2007. Pension optees are not required to pay anything within 60 days from now and the pension option will be given for all, added Venkatachalam.