Nearly eight lakh employees of state-run banks can get performance-linked incentive (PLI) in addition to salary from next financial year. Earlier, the management of banks had proposed variable pay or performance-linked pay. Variable pay is already available to employees of private sector banks.
IBA gave proposal
Sources said that the committee which negotiated the salary of the Indian Banks Association (IBA) had proposed the PLI last week, which has been accepted in principle. The committee is headed by Rajkiran Rai, managing director of Union Bank of India. The PLI can be calculated after announcing the annual results of the banks. A bilateral agreement is on every five years to increase the salaries of the employees of public sector banks. The 11th agreement on the increase in salary is still being negotiated. The agreement is to come into effect from November 1, 2017.
PLI will be different from salary
All India Bank Officers Confederation (AIBOC) General Secretary Soumya Dutta said, "There has been a change in attitude on the issue of performance linked pay. The IBA has clarified that PLI will not be included in the salary. This will be different from the increase in salary in the bilateral agreement. The IBA has offered an increase of 12% in salary, while bank unions are pushing for a hike of at least 15%.
SBI has already made such an offer
Several state-run banks, including State Bank of India, have already offered rewards and incentives to employees based on specific criteria, but the new structure will be different, as it will depend on the performance of the particular banks, not the performance of the employees. Rajan Nagar, president of the All India Bank Employees Association, said, 'The United Forum of Bank Unions has given an in-principle agreement for PLI as it will bring the structure to all public sector banks. Its modalities are yet to be decided.
