Public sector bank Punjab National Bank (PNB) is contemplating to move away from Indian Banks Association (IBA)-led wage settlement to retain talent under its own remuneration package. As of now, the industry body Indian Banks’ Association (IBA), on behalf of all public sector banks, negotiates wage hike with the officers’ association and employee unions. The wage settlement is applicable for five years. In the last wage settlement, which was fixed in last November, employees were given 15% increase in wages. The wage revision was effective from 1 November 2012 and is will be valid till 2017.
As per statement given by Managing director and chief executive Usha Ananthasubramanian , the bank has set up an internal committee consisting of general managers which is studying the feasibility of a new wage structure for the bank. For decades remuneration of government owned banks are linked to industry wide negotiations irrespective to the performance of each employee. Private banks’ remuneration are linked to performance and would vary significant between two employees of the same rank.
Meanwhile, finance ministry has asked public sector banks to start wage negotiations with employees unions and officer association well before it comes for renewal in November 2017.