1

A hundred times everyday I

remind
myself that my inner and
outer life
depended on the labours of
other men,
living and dead and that I
must exert
myself in order to give in the
same
measure as I have received
and am still receiving.
- ALBERT EINSTEIN
Dear friends
OUR STAND OF 25% HIKE IS JUST AND SACROSANCT!
Preface
This approach paper is an attempt by an retired bank trade unionist (retired very
recently) having over four decades of experience in contributing substantially to
bipartite settlements with independent insight and commitment in the past ,including
writing script for the 10 bipartite charter on1!0!"01" itself , which received wide
publicity, acknowledgment, appreciation accolades in many social networking sites
The goal of m !"##er$a$"o% "% $h"# a&&roach &a&er "# $o e%ha%ce $he a'are%e## of
$he (a%) em&loee# a%! $he"r 'ell '"#her# $o ge%era$e "%*+"r"%g m"%!#, '"$h -"e'
of gal-a%"."%g #$ra$eg"e# $o #e$$le $he &re#e%$ "m&a##e "% $he o% go"%g /0 ("&ar$"$e
%ego$"a$"o%#1 2 goal "# $o &re&are a%! merge $he"r hear$# a%! m"%!# $o re#"#$,
re&+l#e $he "%$ra%#"ge%ce of I3A 45o-er%me%$ com("%e "% !e%"%g o+r 6+#$ 'age
re-"#"o% ( co%#"!er"%g o+r !ema%! of m"%"m+m 25 % $ha$ $oo "% &a #l"&
com&o%e%$# a# aga"%#$ $he $ra!"$"o% $"ll 7
$h
("&ar$"$e of #e$$l"%g 'age loa! o%
e#$a(l"#hme%$ e8&e%!"$+re1

# have to the best of my ability enumerated things and events from an historical
perspective1 This paper for obvious reasons cannot be a full commentary of the finished
and unfinished tasks we have$
# am not merely pro or anti establishment$ %n the contrary # know that we am a vital
section of this establishment ourselves and unlike most other sections of the
establishment # want to develop and drive a self critical and critical viewpoint with
view of generating thinking , en&uiring minds, enhance awareness and learning$ #n this
process we learn, unlearn and relearn$ #t is with this sole ob'ective this approach paper
is presented1
The history of collective bargaining also highlights that the management as well as the
unions have always operated with a '"% lo#e #$ra$eg and both the parties have
a$$em&$e! $o 3AR $he 5AIN (ra$her $ha% (arga"%) of each other$ (s a result, there
have been various strikes$ #n their absence the industrial relations have been far from
peaceful$ The management)workers and earlier union members allege)does not
accept the idea of collective bargaining in its true spirit$
*ven in the ongoing negotiations in the 10 bipartite we find this unhealthy bar the gain
trend, against the ethos of true biapartism$ 9h"le $he +%"o%# ha-e re!+ce! $he"r
!ema%! from :0%, I3A a ha# mo-e! a% "%ch from /0 % $o // % o%l !+r"%g $he
la#$ ro+%! of %ego$"a$"o%# o% /:;<;20/= $There after stalemate continues
Thereafter we find a spectacle of negotiations across the table totally stalled, put to
comatose and is replaced with exchange of three letters between the parties much to
disgust and disenchantment of the bank employees$ Thus the 10th industry!wide
bipartite wage settlement negotiations in the banking sector have dragged on for more
than one!and!a!half years now without making much headway$
%nly a meaningful dialogue is regarded primarily as a means aimed at achieving these
goals$ #t is an effective tool for solving collective challenges by creating the structure
and environment suitable for more efficient problem!solving$
%ur public sector banks are ma'or foundation our economy and with changing times
they need to re'uvenate themselves like the private or foreign counterparts, thus giving
#ndia a new momentum$ +o # genuinely believe, reasonable but 'ust wage structures
paripasu with the peers, healthy and professional work culture is the utmost
re&uirement for public sector banks today$ ( healthy wage structure and service
conditions shall inspire further the bank employees to be productive and tech savvy
will bolster their motivation to be more fruitful$ ,eriodical appraisals and recognition
for good work will lead to greater returns rather than making it a typical slow
growing, take!for!granted government 'ob$ #t-s a dismal picture that once a 'ob of
reputation is losing its value$ +o nowadays there is huge change in career priorities of
youngsters, they prefer to experiment with their careers, prefer central government 'obs
because of improved pay structure prevalent today and further value additions the anvil
se&uel to the seventh pay commission rather than settling and languishing in
conventional public sector bank 'ob in government 'obs, of abysmally low wages
compared with other peers in public or private sector$
#t is in this context the 'ust demand of union of "./ wage hike that too in pay slip
components will alone end discrimination and bring semblance of parity , retain
existing , attract dynamic, innovative , &ualified youth to take banking career as
primary option$$
The various chapters on 'ustification of 'ust demand of negotiating union in the banking
industry in this booklet are based innovative, thoughtful and thought provoking,
,critical suggestions and comments given by humble members of the movement in
many social networking sites, circulars issued by much union on the progress on the
ongoing 10 bipartite talks, other important reference materials$
# acknowledge with thanks for their the valuable inputs on this sub'ect and for
coverage given by various social networking sites espousing the cause, with no
commercial interest other than inters of bank employees and their movement$ These
social net working sites are doing splendid 'ob in enhancing the awareness levels of
bank employees uploading scores of other well researched articles on the sub'ect
contribute mainly of bank employees past and present$
#n preparing this document # have freely made use of valuable suggestions by many
individuals and also various resourceful documents, books in good faith with the hope
that authors of these documents oppose patenting of intellectual property rights as they
oppose #01, 2T% dictates$ # term #,3 as 3#, 4 >Re#$r"c$"o% o% I%$ellec$+al
Progre##?$ # hold the conviction that right to information is directly linked with
bringing truth to light$
I%forma$"o% "# &o'er a%! !oc+me%$e! "%forma$"o% "# !emocrac1
(ny part of this book may be freely reproduced in any form by any organisation$ 5ut
we would appreciate the copy of material is sent to my email id given below with
comments for furthering my learning curve and knowledge$
#t is hoped that this booklet will assist in a better understanding of the issues and
aspects raised and discussed and end the stalemate, expedite amicable but honourable
settlement$
# shall be only obliged social networking sites championing the cause of bank
employees to disseminate the import of the message by uploading this in their website
which has wide acceptance, acknowledgments among the bank employees$
# appeal to the apex level union is the banking industry to upload the articles in their
sites, disseminate the import of the message through circulars, publications, maga6ines
etc which has wide acceptance, acknowledgments among the bank employees with
view galvani6e awareness of bank employees, augmenting transparency$ %nly
transparent public opinion shall dispel rumours, disengage truth form false hoods and
in the process spread the beauty of truth$
# assure the bank employees in our country that # shall remain inseparable from the
5ank 7nion movement that has been my extended family, and will always stand by to
guide, when #-m needed
+$+rinivasan
3etired bank unionist
8!9!"018
*mail: ambu'chinu;gmail$com
INDE
CHAPTER SU3JECT
;
#ntroduction
(fter 100 Days %f <ew =overnment
<o >hushi, +till =ham
1or 5ank *mployees
%ur +tand %f "./ ?ike #s @ust (nd +acrosanct
; ,reface
I @ustification # ! #t is lawful
II
@ustification ## ! <eed to reify historic
distortions in bank employees scales of pay
III
@ustification ## #! %ur demand is a 'ustifiable
demand
I@
@ustification #A! %ur Demand is commensurate
with the increase in our productivity and
efficiency
@
@ustification A; %ur demand Demolishes
untruths B falsehoods
@I
@ustification A#! %ur demand is reasonable and
achievable
@II Conclusion 4 2ay 1orward
@III The +cintillating Aoyage +o 1ar
IA
bank employees improvements in wages &
service conditions
awards / settlements
AFTER 100 DAYS OF NEW GOVERNMENT
NO KHUSHI, STILL GHAM
FOR BANK EMPLOYEES
by
+$+3#<#A(+(<
3etired 5ank 7nionist
OUR STAND OF 25% HIKE IS JUST AND SACROSANCT!
#n 19DD, when 1ranklin D 3oosevelt summoned a special session of Congress that
would run for three months, the newly elected president got the Democrats and
3epublicans to work together and give Congressional passage to a series of measures
aimed at 'ob!creation and providing an impetus to a tottering economy$ Those 100 days
of Congress, also his first 100 days as president, saw 1. ma'or bills get passed, a record
for 7+ legislation that 1D3 would go on to call the E<ew DealE$
That-s how the Ffirst 100 daysF yardstick of measuring the effectiveness of new
governments came to be fashioned, a measure of how much a government can achieve
when it-s still in the afterglow of electoral success, riding high on public opinion and
driven by high expectations$
(t the end of 100 days there is, doubtless, a stock!taking$ There are be more pithy
slogans and catchy, self!congratulatory phraseology$
During thee 100 days Bank unions met Finance Minister to press for early wage
revision on June27 201!" D!"#$ % &%"! '( 21 )'*$+! !#*, $+ !$%-$
'( *.'$#%$#'*!, *' !#.*#(#,%*$ #)"-'/)*$ +%! 0* )%1 $'2%-1!
3"1#$#'4! ,'*,&4!#'* '( !$$&)*$5
0ake no mistake, the speeches to the countrymen by the new government will continue
to be fine tuned, but the first 100 days is 'ust bluster for bank employees expecting 'ust
wage revision of at least restoring parity with Central =overnment *mployees se&uel to
the
th
pay commission, going by early indications and reports$
Ges, Hache dinI (good days) have indeed come for some$ 5ut Hbad daysI have befallen
to the 5ank employees$ The preposterous, stubborn stand of #5(
re#+l$"%g "% re&laceme%$ of $ra!"$"o%al Bro+%! $a(le %ego$"a$"o%#C '"$h
Bcorre#&o%!e%ce#C af$er $he la#$ mee$"%g o% /:
$h
J+%e 20/= ha# #ha$$ere! o+r ho&e#
a%! (a$$ere! o+r !ream# of a% earl #e$$leme%$$ The entire workforce have felt the
insult inflicted by #5(, who failed to live upto the expressions made by #5( Chairman
in the first round of discussions held on ""!0D!"01D that the settlement would be
concluded at the earliest with reasonable, respectable and comparable wage revision
compared with external factorsI$
I% #hor$ 'e are %o$ hear"%g #+%% #o%%e$# or moo%l"$ melo!"e# of #+cce##f+l
(rea)$hro+gh "% $he 'age re-"#"o% , (+$ f+m(l"%g ( $he 5o-er%me%$, (+%gl"%g
( I3A com("%e , cr+m(l"%g of "%!+#$r"al &eace, gr+m(l"%g# ( $he c+#$omer#
a%! r+m(l"%g# of a m"gh$ +&#+rge of (a%) em&loee#, 'ho a'a)e%e! a%! are "%
rea!"%e## $o 'r"$e h"#$or '"$h (loo! a%! $ear#$
CHAPTER 6 I
JUSTIFICATION ID IT IS EA9FUE
The intransigence stand of #5( in not calling union for negotiations, disregarding sprit
of bipartite culture , uni&ue in banking industry culminating in 9 bipartite settlements
so for, suddenly without any logical, transparent reasons, during this 10 bipartite under
progress after 1D!0 !"018 is preposterous$
*ven with "./ increase we will be lagging behind the government employees if one
realistically evaluates their pro'ection in wake of announcement of J pay commission in
the anvil$
0y arguments is backed 5y @ustice >antilal Desai in his award popularly known as
Desai (ward$ ?ence our demand of "./ hike to restore parity with government
employees and other ,+7Ks is 'ust and right, and is accordance with awards in force for
bank employees$ (brogating the legal sanctity of these awards of learned 'udges by
peddling spurious logic tantamount to disrespecting the laws of the land$
%ur terms have always been clear$ The #5(-s terms have also been clear, of course
according to them, for which we can never come to terms$ They always find, as was the
experience in the earlier negotiations, our demand and our stand to be irrational and
unreasonable and yet to have conceded to some of them$ +o whatever we conceded is
reasonable for them and what we do not concede is unreasonable for them$ The reality
today is nothing is well settled in labour matters in our country$ The little achievements
we have secured are not because our demands were reasonable but that each
achievement is incomplete inspite of its reasonableness$ #t re&uired bitter struggles
before inch of progress could be made$ Throughout this historic century of struggles
runs one red thread of continuity is ! resistance ! by the employers to demands of the
employees for improvements even though reasonable$ The strange arguments
advocated by the 5ank Lords before the Tribunal for the 5ank-s disputes and now by
#5(, stand elo&uent witness to this conviction$ # re&uest the readers to google and go
through the spur8ios arguments denying bank employees reasonable wages even during
the Desai award (19") days (see para .$1.9$ to .$11, page 1J0 desai ward)
2e know the methods #5( used to adopt to dilate our issues and hoodwink our
demands$ 5ut this time the boldness, sophistry, ruthlessness and courage with which
they have come out openly and spelt out their unwillingness to accept our reasonable
demands and response makes bipartite culture a mockery$
Denial of our 'ust demands is unconscionable and un'ustified$
#f today in our anxiety to secure arrears and marginal increase in wages, we
compromise on principles in accepting their unreasonable, irrational demands,
tomorrow we will be compelled to sign on dotted lines even in matters suicidal to our
interest$
#5(-s spurious, perverse theories which we exposed and exploded as the past are again
in the market of industrial relations with their spurious products sowing seeds of
industrial unrest$ Their pet theories are standing monuments of our agony and
stumbling block for industrial peace$
# have made some made so modest attempt to enhance the awareness of bank
employees culling important facts form the glimpses of history$ Let history record that
in spite of the greatest odds 5ank employees would stand up and resist in'ustice and
re'ect with disdain and contempt the demands of #5( with logic and reason, retaining
the ground sells of historical perspective$ <eedles to underscore that the present is
imbedded in the past and from the present future grows as per law of nature$
Let us get emboldened form history:
Pr"%c"&le# of 9age F"8a$"o% +ource: Desai (ward
.$D.$ This Tribunal has been constituted under the #ndustrial Disputes (ct, 198J$ The
preamble to the (ct indicates that the said (ct was enacted to make provision for the
investigation and settlement of industrial disputes, and for certain other purposes
appearing in the said (ct$ 7nder section J5, the Central Government is empowered to
constitute one or more National Industrial Tribunals for the adjudication of the
industrial disputes which, in the opinion of the Central Government, involve questions
of a national importance or for the adjudication of industrial disputes which are of
such a nature that industrial establishments situated in more than one tate are li!el" to
be interested in, or affected b", such disputes# In considering disputes the adjudication
whereof involves questions of a national importance it would not be out of place to
refer to the following words of the $reamble to the Constitution of India which express
the will of the people of India %&
'e, the $eople of India, having solemnl" resolved############to secure to all its citi(ens %
)ustice, social, economic and political* ############ +qualit" of status and of opportunit"*
and to promote among them all ,raternit" assuring the dignit" of the
individual##################### give to ourselves this Constitution#-
5y the Directive ,rinciples of +tate ,olicy embodied in (rticle 8D of the Constitution it
is provided that the +tate shall endeavour to secure, by suitable legislation or economic
organisation or in any other way to all workers, agricultural, industrial or otherwise,
work, a living wage, conditions of work ensuring a decent standard of life and full
en'oyment of leisure and social and cultural opportunities$
.$D$ %n "1st December 19.8 the Lok +abha adopted a resolution by which the
establishment of a socialistic pattern of society has been accepted as the ob'ective of
+tate ,olicy with the consent and concurrence of all the political parties in the country$
The ad'udication in respect of the matters referred to the Tribunal has to be done in the
background of the statement in the ,reamble to the Constitution, the Directive
,rinciples of +tate ,olicy and the resolution unanimously adopted by the Lok +abha$
.$DJ$ The 'urisdiction of a <ational #ndustrial Tribunal in determining matters which
come before it is in certain respects wider than the 'urisdiction of an ordinary Court of
law$ (n ordinary Court of law proceeds on the footing that no power exists in the
Courts to make contracts for persons and that the parties must make their own contracts$
The Courts reach their limit of power when they enforce contracts which the parties
have made$ (n #ndustrial Tribunal is not so fettered and may create new obligations or
modify contracts in the interest of industrial peace, to protect legitimate trade union
activities and to prevent unfair practice or victimisation$ #t has been so held by the
+upreme Court in 3ohtas #ndustries Ltd$ v$ 5ri'nandan ,ande and others, 19. +upreme
Court 3eport M00, 19. (##) Labour Law @ournal 888 at page 889$ (s observed by
Ludwig Teller in Labour Disputes and Collective 5argaining, Aol$ # at page .D:)
H#ndustrial arbitration may involve the extension of an existing agreement, or the
making of a new one, or in general the creation of new obligations or modifications of
old ones, while commercial arbitration generally concerns itself with interpretation of
existing obligations and disputes relating to existing agreements$I
The 1ederal Court in the case of 2estern #ndia (utomobile (ssociation Ltd$ v$
#ndustrial Tribunal and others, 1989 1ederal Court 3eport D"1 at page D8., 1989
Labour Law @ournal "8., has observed that the above statement by Ludwig Teller was a
true statement about the functions of an #ndustrial Tribunal in Labour disputes$ The
relations between employers and employees
are no longer left to the free play of economic forces$ The concept of social and
economic 'ustice as embodied in the Directive ,rinciples of +tate ,olicy comes into
play$ The needs of the industry have to be harmonised with the needs of the workmen
and the dignity of the individuals$ To secure a living wage is the ob'ective of +tate
,olicy$ 5efore a living wage can be secured to workmen various factors have to be
considered$ The industry concerned must have the capacity to bear the burden of a
living wage to workmen
.$DM$ 2ages have been considered under three different heads:)
(1) Living 2age,
(") 1air 2age, and
(D) 0inimum 2age$
These concepts have been fairly dealt with in the report of the Committee on 1air
2ages$ ( large part of its conclusions has been accepted by the +upreme Court in the
case of *xpress <ewspapers (,rivate) Ltd$ and another v$ The 7nion of #ndia, 19.9
+upreme Court 3eport 1", 191(1) Labour Law @ournal DD9$ The most expressive
definition of a living wage is that given by @ustice ?iggins of the (ustralian
Commonwealth Court of Conciliation in the ?arvester case$ ( living wage is defined by
@ustice ?iggins as one appropriate for Hthe normal needs of the average employee,
regarded as a human being living in a civilised community$I This cryptic
pronouncement has been explained by @ustice ?iggins by saying that a living wage
must provide not merely for absolute essentials such as food, shelter and clothing but
for Ha condition of frugal comfort estimated by current human standards$I#t must be a
wage Hsufficient to insure the workman food, shelter, clothing, frugal comfort,
provision for evil days, etc$ as well as regard for the special skill of an artisan if he is
one$I #n a subse&uent case he observed that Htreating marriage as the usual fate of adult
men, a wage which does not allow of the matrimonial condition and the maintenance
of about five persons in a home would not be treated as a living wageI$
#n the 3eport of the Committee on 1air 2ages it is stated in paragraph J as under:)
Hthere is general agreement that the living wage should enable the male earner to
provide for himself and his family not merely the bare essential of food, clothing and
shelter but a measure of frugal comfort including education for the children, protection
against ill!health, re&uirements of essential social needs, and a measure of insurance
against the more important misfortunes including old age$I
.$D9$ ( reference may be made to the following observations of 0r$ ,hilip +nowden at
pages 1 and of HThe Living 2ageI in connection with the concept of a living wage
and the problem of converting the concept into monetary terms :)
H#t may be possible to give a precise or satisfactory definition of a living wage, but it
expresses an idea, a belief, a conviction, a demand$ The idea of a living wage seems to
come from the fountain of 'ustice which no man has ever seen, which no man has ever
explained, but which we all know is an instinct divinely implanted in the human heart$
( living wage is something far greater than the figures of a wage schedule$ #t is at the
same time a condemnation of unmerited and unnecessary poverty and a demand for
some measure of 'ustice$I
N N N N
HThe amount of the living wage in money terms will vary as between trade and trade,
between locality and locality$ 5ut the idea is that every workman shall have a wage
which will maintain him in the highest state of industrial efficiency, which will enable
him to provide his family with all the material things which are needed for their health
and physical well being, enough to enable him to &ualify to discharge his duties as a
citi6en$I
The +upreme Court in the case of +tandard Aacuum 3efining Company of #ndia Ltd$, v$
#ts workmen (including clerical staff) and another (,etroleum 3efineries *mployees-
+abha) reported in 191(1) Labour Law @ournal page ""J at page "D8 has observed that
it is in the aforesaid broad and idealistic sense that a reference has been made in (rticle
8D of the Constitution to the living wage$ The concept of a Living 2age is not a static
concept$ #n connection with the concept of basic minimum wage, fair wage and living
wage, the +upreme Court has in the aforesaid case observed at page "DD as under:)
Hthe concepts of these wages cannot be described in definite words because their
contents are elastic and they are bound to vary from time to time and from country to
country$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$ 2hat is a subsistence wage in one country may appear to
be much below the subsistence level in anotherO the same is true about a fair wage and a
living wageO what is a fair wage in one country may be treated as a living wage in
another, whereas what may be regarded as a living wage in one country may be no more
than a fair wage in another$I #t has further observed at page "D9 that under the living
wage a workman would be entitled to claim an optimum diet as prescribed by Dr$
(ykroyd$ +imilarly the re&uirements as to clothing and residence which have been
recognised in the tripartite resolution, though appropriate in reference to a need based
minimum wage would have to be widened in relation to a living wage$ 5esides, in
determining the money value of the living wage it would be necessary to take into
account the re&uirements of Hgood education for children, some amusement, and some
expenditure for self development$I
.$80$ #n connection with the concept of a minimum wage, it has been observed by the
Committee on 1air 2ages that a minimum wage must provide not merely for the bare
sustenance of life but for the preservation of the efficiency of the worker by providing
for some measure of education, medical re&uirements and amenities$ #t has been further
observed that the minimum wage must be paid irrespective of the capacity of the
industry to pay the same$ #n connection with the concept of minimum wage a reference
is necessary to the resolution passed at the 1.th Labour Conference held at <ew Delhi
on 11th and 1"th @uly, 19.J wherein certain norms have been laid down$ The same have
been considered at some length in another part of this award$
.$81$ #n connection with the fair wage, it is observed by the Committee on 1air 2ages
that there was complete unanimity of opinion that the fair wage should on no account
be less than the minimum wage$ The +upreme Court in the case of the *xpress
<ewspapers (,rivate) Ltd$ has observed at page D8 that the fair wage is Ha mean
between the living wage and the minimum wage$I (s observed by the Committee on
1air 2ages while the lower limit of the fair wage must obviously be the minimum
wage, the upper limit is e&ually set by what may broadly be called capacity of industry
to pay$ 5etween these two limits the actual wages will depend on:)
(1) the productivity of labourO
(") the prevailing rates of wages in the same or similar occupations in
the same or neighbouring localitiesO
(D) the level of the national income and its distributionO and
(8) the place of the industry in the economy of the country (ccording to
the 3eport of the Committee on 1air 2ages in determining the capacity of an
industry to pay, it would be wrong to take the capacity of a particular unit or
the capacity of all industries in the country$ The relevant criterion should be
the capacity of a particular industry in a specified region to be ascertained by
taking a fair cross section of that industry$ The +upreme Court in the case of
the *xpress <ewspapers (,rivate) Ltd$ at page D has observed that:)
HThe capacity of an industry to pay should be gauged on an industry cum!region basis
after taking a fair cross!section of that industry$ #n a given case it may be even
permissible to divide the industry into appropriate classes and then deal with the
capacity of the industry to pay classwise$I
.$8"$ The level of wages should be so fixed as to enable the industry to maintain
production with efficiency$ The fair wages fixed should not be so out of tune with
wages in other industries in the region as to cause movement of labour and conse&uent
industrial unrest$ The +upreme Court in the case of *xpress <ewspapers (,rivate) Ltd$
has observed at page DD as follow:!
H The main consideration which is to be borne in mind is that the industry should be able
to maintain production with efficiency and the fixation of rates of wages should be such
that there are no movements from one industry to another owing to wide disparities and
employment at existing levels is not only maintained but if possible increased$I
.$8D$ *$ 0$ 5urns in the book H2ages and the +tatesI has at page DMJ referred to
various considerations which have to be borne in mind when fixing wages$
H#t would be necessary to in&uire "%$er al"a into the elasticity of demand for the
product, for on this depends the extent to which employers could transfer the burden of
the increased wage to consumers$ #t would also be necessary to in&uire how far the
enforced payment of a higher wage would lead employers to tighten up organisation
and so pay the higher wage without difficulty$
N N N N
+imilarly it fre&uently happens that an enhanced wage increases the efficiency of the
lowest paid workers: the resulting increase in production should be considered in
con'unction with the elasticity of demand for the commodity before the ability of a
trade to pay can fairly be 'udged$
N N N N
(gain unless what the trade can bear be held to imply that in no circumstances should
the existing rate of profit be reduced, there is no reason why attempts should not be
made to discover how far it is possible to force employers to bear the burden of an
increased rate without driving them out of business$ This would involve investigation
into the elasticity of supply of capital and organi6ing ability in that particular trade, and
thus an in&uiry into the rate of profits in other industries, the ease with which
transferences might be made, the possibility of similar wage regulation extending to
other trades, and the probability of the export of capital and organi6ing ability, etc$I
.$88$ #n the 1irst 1ive Gear ,lan the authors thereof have observed at page .M8 as
follows :)
" (a) (ll wage ad'ustments should conform to the broad principles of social
policy and disparities of income have to be reduced to the utmost extent$ The
worker must obtain his due share in the national income$
(b) The claims of labour should be dealt with liberally in proportion to
the distance which the wages of different categories of workers have to cover
before attaining the living wage standard$
.$8.$ The principles of industrial ad'udication have been well set out in the decision of
the +upreme Court in the case of 0Ps$ Crown (luminum 2orks v$ Their 2orkmen,
reported in 19.M (1) Labour Law @ournal page 1 at page in words following which
may well be reproduced here :)
HThough social and economic 'ustice is the ultimate ideal of industrial ad'udication, its
immediate ob'ective in an industrial dispute as to the wage structure is to settle the
dispute by constituting such a wage structure as would do 'ustice to the interests of both
labour and capital, would establish harmony between them and lead to their genuine
and wholehearted co!operation in the task of production$ QQ #n achieving this immediate
ob'ective industrial ad'udication takes into account several principles such as for
instance, the principle of comparable wages, productivity of the trade or industry, cost
of living and ability of the industry to pay$ QQQQ #n deciding industrial disputes in
regard to wage structure one of the primary ob'ectives is and has to be the restoration of
peace and good will in the industry itself on a fair and 'ust basis to be determined in the
light of all relevant considerations$I
.$8$ This Tribunal will have to keep in mind these principles to the extent that they are
applicable in the circumstances of the case$
.$8J$ The problem of wage determination cannot be considered in isolation from the
larger economic and social background obtaining in the country$ ( delicate balance has
to be struck between fair wages to workers and officers fair profits to the shareholders
and fair service at reasonable rates to the community, after taking into account the share
of the =overnment in profits in the shape of taxes and after considering the amounts of
reserves and depreciation necessary for the stability and healthy functioning of the
industry$
1rom the purely economic point of view the wage policy has to take into account the
inflationary pressures$ #t is necessary to provide for wage differentials based on 'ob
evaluation as the economic structure in #ndia- is not founded on the principle : Hto each
according to his needs and from each according to his capacity
Para 51/:F>&age /:5?
CAPACITG OF THE INDUSTRG TO PAG
.$1DJ$ 2hilst considering the &uestion of wages in the banking industry, it will be
necessary to consider the &uestion of the capacity of the industry to pay wages above
the bare minimum wage and the place of the industry in the economy of the country$
The &uestion concerning the capacity of an industry to pay wages has been dealt with at
some length by the +upreme Court in the case of *xpress <ews ,apers (,rivate) Ltd$,
and another v$ The 7nion of #ndia and others, reported in (19.9) +upreme Court
3eports, page 1" at pages M9 to 9D$ (s the +upreme Court has observed in that case, the
capacity of industry to pay can mean one of the three things, vi6$, (i) capacity of a
particular unit, (marginal, representative or average) to pay, (ii) the capacity of a
particular industry as a whole to pay, or (iii) the capacity of all industries in the country
to pay$ (fter considering the various aspects of the matter, the +upreme Court has, at
pages 9" and 9D of the aforesaid report, observed as follows :)
HThe principles which emerge from the above discussion are:)
(1) that in the fixation of rates of wages which include within its compass the
fixation of scales of wages also, the capacity of the industry to pay is one of the
essential circumstances to be taken into consideration except in cases of bare
subsistence or minimum wage where the employer is bound to pay the same
irrespective of such capacityO
(") that the capacity of the industry to pay is to be considered on an industry!
cum!region basis after taking a fair cross section of the industryO and
(D) that the proper measure for gauging the capacity of the industry to pay should
take into account the elasticity of demand for the product, the possibility of
tightening up the organisation so that the industry could pay higher wages
without difficulty and the possibility of increase in the efficiency of the lowest
paid workers resulting in increase in production considered in con'unction with
the elasticity of demand for the product no doubt against the ultimate background
that the burden of the increased rate should not be such as to drive the employer
out of business$I
The +upreme Court has observed in an earlier paragraph that in a given case it may be
even permissible to divide the industry into appropriate classes and then deal with the
capacity of the industry to pay class!wise$ The industry of banking, in cases where the
banks have branches in more +tates than one, has been dealt with class!wise, and the
capacity of the industry which, so far as the banks before me are concerned, has to be
determined class wise$
?aving regard to the principles enunciated by the +upreme Court, the capacity of the
industry considered class!wise will have to be determined after taking a fair cross
section of each class$ (s observed by the +astry Tribunal the wage structure should be
such as to be within the capacity of the #ndustry to bear in the light not apply of its
present position, but of its future possibilities also$
.$1DM$ The industry of banking does not produce goods but produces services$ #t is an
extremely important service which is rendered by banks and on the continued and
efficient functioning of banks depends the smooth functioning of a large number of
other industries in the country$ #n order that the economy of the country may develop
and other industries may function smoothly, it is necessary that the industry of banking
should also develop to meet the growing needs of the country$ 5anking has to be
regarded as a public service and its activity to a certain extent is being regulated in the
public interest$ There are various provisions in the 5anking Companies (ct, 1989, and
in the 3eserve 5ank of #ndia (ct relating to the regulation and control of the industry in
the larger interest of the country$ 5anks have to work in a more or less rigid framework
set by law$ The depositing and investing public always plays for safety for its deposits
and stability for its investments$ ,rudent banker not merely provide for what are
sometimes known as secretor undisclosed reserves but provide for easy li&uidity of
some of its assets in order to meet any emergency$ They also consider the advisibility of
following the policy of maintaining stable dividends$ *very effort has to be made
together the confidence of the public and the depositors so that the working funds and
operations of the banks may grow$
.$1D9$ The stability of the industry depends upon the over!riding factor of credit$ The
banks are very often described as delicate instruments of credit$ The failure of the bank
has its repercussions on the other banks and on the deposits made with other banks$
=reat care is re&uired to inspire the confidence of the public$ Deposits received by the
banks constitute, to a very large extent, the raw material for providing advances to
persons needing the same$ ( bank unlike a manufacturing concern obtains a very large
proportion of its working funds from the depositors and only a small proportion from its
shareholders$ #n considering the claims of employees, the claims of the depositors and
other constituents of the bank have also to be kept in mind$
.$180$ #n considering the capacity of the industry of banking to bear the burden of
increased wages which may be re&uired to be paid having regard to the workmen-s
claims based on social 'ustice, it is necessary to bear in mind the claim of the
shareholders to a fair return on the capital invested by them$
.$181$ 5anking is one of the key industries in the country$ The successful
implementation of the Third 1ive Gear ,lan depends to a considerable extent on the
successful operation of banking in the country$ #t is re&uisite that the available resources
of the country should be harnessed for the successful implementation of the Third 1ive
Gear ,lan$ 5anks have an important role to play in moblising the resources of the
country and canali6ing them to productive purposes$ #t is necessary that the banking
habit should spread throughout the length and breadth of the country so that the unused
wealth of the country is not merely gathered but is put to effective use$ The dependence
of commerce upon banking has in modern times become exceedingly great and matters
have reached a stage where the cessation for some length of time of banking activity
may paralyse to some extent the economic life of the nation$ 5ankers issue credit$ Large
transactions are effected by means of che&ues rather than by the exchange of currency$
5anks assist the industrial undertakings by underwriting their debentures and shares and
occasionally finance the purchase of real property$ 5anks serve as custodians of stocks
and shares and other valuables$ #mports into and exports out of the country are financed
by banks and documents relating to the goods so imported and exported pass through
the hands of the bankers$ They have to deal with warehouse warrants, bills of leading,
railway receipts, bills of exchange, marine insurance policies and various other
documents$ They advance moneys on securities and issue letters of credit and travellers
che&ues to customers$ The functions which the bankers discharge are numerous and
varied$ The transactions on the +tock *xchange may be affected by the policy adopted
by banks in connection with the advance on shares and securities$ Transactions of
purchase and sale of various commodities may be affected by the policy adopted by
banks in connection with the advance on such goods$ *xpansion or retraction of credit
may affect financing of various transactions$ The smooth functioning of banks is
necessary for the economic growth and welfare of the country$ ,eace in this industry is
re&uisite for the economic progress of the country at the pace set by the Third 1ive Gear
,lan$
.$18"$ ?aving regard to these factors, wage scales have to be fixed in connection with
each class of banks before me, so that the burden ultimately imposed may not be such
as may drive any bank managed with reasonable efficiency, out of business$ The wage
structure should be such that it should not be unduly below the paying capacity of the
bank at the top of the class, nor unduly above the paying capacity of the bank at the
bottom of the class, which is reasonably well!managed$ %ne does sometimes come
across banks in the private sector which continue to function for a number of years
without distributing a naya paisa by way of dividend, which do not show any
substantial profits or which show even losses for a number of years without any special
reason, when other banks functioning in the same region with smaller working funds
and reserves make considerable profits$ +uch banks which continue to exist for various
reasons peculiar to those who run the banks cannot be taken into account to depress the
wages of the class in which such banks fall$ #t would be putting a premium on the
existence of unhealthy banks if they are encouraged to continue their activities by the
incentive of lower wages$
.$18D$ There are various restrictive provisions contained in the 5anking Companies (ct$
5y +ection 1J it is made obligatory on a banking company incorporated in #ndia to
create a reserve fund$ ( banking company is under an obligation Hout of the balance of
profit of each year as disclosed in the profit and loss account prepared under section "9
and before any dividend is declaredI to transfer to the reserve fund a sum e&uivalent to
not less than "0 per cent of such profit until the amount of such reserve fund together
with the amount in the shares, premium account, e&uals the amount of the paid!up
capital of the company$
>8-"? Pre-a"l"%g Ra$e# of 9age# "% Com&ara(le Co%cer%# >See &age/F= ;
/F5 of De#a" 9ar!?
.$1J$ %ne of the important factors to be taken into account in fixing wage scale is the
prevailing rates of wages in the same or similar occupations in the same or
neighbouring localities$
.$1JJ$ The Sa#$r Tr"(+%al "% co%#"!er"%g $he &re-a"l"%g ra$e# of 'age# ha#
o(#er-e! $ha$ hel&f+l com&ar"#o%# co+l! (e ma!e (e$'ee% 'age# "% ma6or (a%)#
a%! $ho#e "% #mall (a%)#, (e$'ee% (a%)# o% $he o%e ha%! a%! cer$a"% "%!+#$r"e# o%
$he o$her, (e$'ee% $he (a%) a'ar!# a%! $he a'ar!# "% "%#+ra%ce com&a%"e#, o"l
com&a%"e# a%! $e8$"le com&a%"e# a%! $ha$ $he ra$e# of &a "% cer$a"% !e&ar$me%$#
of 5o-er%me%$ #+ch a# $he Po#$# a%! Telegra&h# a%! "% S$a$e 5o-er%me%$# 'o+l!
al#o f+r%"#h ma$er"al for $he co%#$r+c$"o% of a &a #cale for $he (a%) 'or)me%1 I$
al#o referre! $o $here &or$ of $he F"r#$ Pa Comm"##"o% a%! #$a$e! $ha$ $here 'ere
#e-eral aff"%"$"e# (e$'ee% (a%) 'or)me% a%! 5o-er%me%$ cler)#, (a%)
#+(or!"%a$e# a%! 5o-er%me%$ me%"al#1 The Sa#$r Tr"(+%al ha# #e$ o+$ $he #cale
of &a for cler)# "% $he #er-"ce of $he -ar"o+# S$a$e 5o-er%me%$# a%! al#o "% $he
#er-"ce of $he Ce%$ral 5o-er%me%$1 I% &aragra&h 2<0 of "$# a'ar! "$ ha# o(#er-e!
a# follo'#D
H%r again we may take a cross section of the wage map of #ndia for clerical staff and
compare the prevailing rates in a mixed bag consisting of industrial concerns,
municipalities, insurance companies, government departments, ,ort Trust and 3eserve
5ank of #ndia$I
The +astry Tribunal has then set out the emoluments received at the initial start by
members of the clerical staff of various concerns in this mixed bag$ #t has also given a
summary of the emoluments given to clerks under the more important award relating to
various concerns$
.$1JM$ The Ea(o+r A&&ella$e Tr"(+%al af$er referr"%g $o $he fac$ $ha$ $he Sa#$r
Tr"(+%al ha! #e$ o+$ "% "$# a'ar! $he $o$al emol+me%$# of a m"8e! (a$ch of
"%!+#$r"e# a%! 5o-er%me%$ a%! *+a#";5o-er%me%$ "%#$"$+$"o%# #$a$e! $ha$ "$ ha!
collec$e! o$her ma$er"al al#o1 The Ea(o+r A&&ella$e Tr"(+%al ha# $hereaf$er #e$ o+$
$he $o$al emol+me%$# &aa(le $o a cler) a$ $he "%"$"al #$ar$ "%2H !"ffere%$ co%cer%#1
(fter considering the emoluments payable in these
1$ 5urmah +hell !!!! 19.$00 ""8$.
"$ +tandard 4 Aacuum !!!! 190$00 ""8$.
D$ =eneral 0otors !!!! 1J0$00 ) closed down
8$ 1ord 0otors !!!! 1.8$. ) closed down
.$ =laxo Laboratories !!!! 11$9 19"$D"
$ #mperial Tobacco !!!! 19.$00 "".$00
J$ ?industan Aanaspati ?industan
M$ Lever 5rothers !!!! L#vers 1J8$MJ ""0$00
9$ 7nited Traders
10$ Tata %il 0ills !!!! 1.8$. 1JM$.
11$ Aolkart 5rothers (Aoltas) 1D.$00 1MD$0
1"$ =reaves Cotton !!!! 1.8$. 19D$.0 (7nder appeal in
+upreme
Court)
1D$ +wastik %il 0ills !!!! 189$. 1J9$J.
18$ Larsen B Toubro !!!! 11$1" 190$M
1.$ =rahams Trading Co$ !!!! 1.8$. 1M$.8
1$ #mperial Chemicals !!!! 1D9$00 1J$00
1J$ Tata #ndustries 1"0$00 !!!! <ot available
1M$ (ssociated Cements !!!! 1DM$00 19$00
19$ %riental (ssurance !!!! 1"8$.0 1.8$D9 <ow part of Life #nsurance
Corporation
"0$ 3eserve 5ank of #ndia 18"$.0 !!!! 7nder ad'udication
"1$ 5ritish #nsulated Calenders !!!! 1DM$00 1JM$00 Cables Ltd$ (#ndian Cables)
""$ 5ombay =as Co$ 1".$00 !!!! <ot available
"D$ 1ortes, 1orbes Campbell !!!! 1.1$00 11$".
<ote: ! *xisting dearness allowance in the concerns in 5ombay is calculated on
5ombay consumer price index slab (811!8"0) for 1ebruary 191 at 8"0 5ombay index
number when the corresponding all!#ndia consumer price index with base as 1989, was
1"D$
If $he me$ho! a!o&$e! ( $he Ea(o+r A&&ella$e Tr"(+%al for $he &+r&o#e of f"8"%g
$he $o$al emol+me%$# of a cler) "% a% A Cla## (a%) "% Area I "# a!o&$e!, $here "# a
goo! ca#e ma!e o+$ for re-"#"o% of $he emol+me%$# of'or)me% "% $he (a%)"%g
"%!+#$r1
>8-""? Ne' Scale# of Pa >SE PA5E /F<;/FF OF DESAI A9RDS?
.$1J9$ There is considerable material placed before me to show that as a result of the
awards of ad'udicators and wage boards and agreements arrived at between employers
and employees, there has been a considerable increase in the level of total emoluments
paid by various concerns$ +ome of these are comparable and some are not$ 3 a%!
large, $he #ho' $ha$ $here "# a% +&'ar! $re%! "% 'age# &aa(le (o$h $o $he
mem(er# of $he cler"cal #$aff a%! mem(er# of $he #+(or!"%a$e #$aff1
.$1M0$ It has been strongl" urged on behalf of the ban!s that the astr" .ward as
modified having lin!ed the dearness allowance with the consumer price index number
has provided for an increase in the amount of wages having regard to the increase in
the cost of living and that no case exists for an" further increase in the remuneration
pa"able to wor!men$ There is no doubt that workmen are being paid more today than
what they were receiving at the time when the Labour (ppellate Tribunal-s decision
was implemented$ The 'or)me%, ho'e-er, co%$e%! $ha$ $here "# %o "%crea#e "% $he"r
real 'age# a%! $ha$, o% $he co%$rar, $here "# co%#"!era(le ero#"o% "% $he"r real
'age# ha-"%g regar! $o $he "%crea#e "% $he co#$ of l"-"%g a%! $he re!+c$"o% "% $he
&+rcha#"%g &o'er of mo%e1 The ar"$hme$"cal ero#"o% $ha$ ha# $a)e% &lace ha#
alrea! (ee% #e$ o+$ earl"er "% $h"# cha&$er1 ( member of the clerical staff employed
by an ( Class 5ank in (rea # in the first year of his service receives at the #ndex <o$
1"D (1989R100) by way of basic pay and dearness allowance 3s$ 1."$M. and 3s$ M as
house rent allowance if he is employed at 5ombay and Calcutta and 3s$ as house rent
allowance if he is employed at other places with population over J lakhs$ The &uestion
that arises for consideration is whether what is being given under the +astry (ward as
modified is sufficient having regard to the changes in the circumstances that have taken
place$
51/H/1 Ha-"%g co%#"!ere! all a#&ec$# of $he ma$$er, I am of $he -"e' $ha$ $o $he
e8$e%$ $ha$ &re-a"l"%g ra$e# of 'age# "% #"m"lar occ+&a$"o%# "% $he #ame local"$"e#
&la a &ar$ "% $he f"8a$"o% of 'age#, $he 'or)me% ha-e ma!e o+$ a ca#e for a%
+&'ar! re-"#"o% of $he"r emol+me%$#$
CONCEUSION >6+#$?
1$ Today the banking industry with %a$"o%al".e! (a%)# forming ma'or share as a
whole (unlike the award days) has immensely prospered and tremendously
expanded$
"$ Cost of living has substantially gone up throughout #ndia$
D$ <ational income under 1ive Gear ,lans has considerably increased$
8$ ,revailing rates of wages in other industries, including government employees
have also considerably gone up$ The government as model employer cannot deny
'ustifiable and 'ustisiable wages at par with government employees, to bank
employee alone$
.$ The existing wage scales as per the comparison shown in the (nnexure (
between government and bank employees are not at all ade&uate to ensure
minimum subsistence wage for the clerical and subordinate staff, having regard
to the high cost of living prevailing all over the country$
$ <ot only the rise in the cost of living should be fully neutrali6ed but there should
be improvement in the real standard of living of the employees$
J$ The nature of work in the banking industry today re&uires greater skill, involves
risks accuracy, responsibility and hard labour than that re&uired in other
industries$
Thus it is imperative that bank employees are ade&uately compensated due to their
glowing responsibility, transferability, accountability in order to maintain high
standards of honesty, integrity as their 'ob demands in a highly competitive and
sensitive sector of the #ndian economy, in view of the following
,ublic sector banks practically government institutions today as could be seen form
the additional auxiliary work performed by bank employees which was hitherto
performed by government employees and in view of the reasons adumbrated ,adduced
below
1$ (ll public sector banks ac&uired the public sector characteristic by virtue of a
special act passed by the #ndian ,arliament$
"$ Central =overnment directly and indirectly through other ,+7s like L#C of #ndia
etc$ holds ma'ority of the shareholdings in public sector banks$
D$ +everal public sector banks are bankers to the government ! Central or +tate !
either as a lender or a custodian of government funds$ ,ublic sector banks have
subscribed to several =overnment ,romissory <otes, Treasury 5ills and 5onds
and Debentures issued by +tatePCentral ,+7s$
8$ ,ublic +ector 5anks have established and manage Currency Chests throughout
the country on behalf of 35#, thus playing a vital role in currency issue and
management /printing is the sole prerogative of 01I2#
.$ ,ublic +ector 5anks run clearing houses throughout the country, thereby helping
the government manage the nationEs economy, trade and commerce$
$ *ven today, ,ublic +ector 5anks have the ma'ority share of the public savings
(more than JJ/), en'oying the confidence and trust of most of the common
citi6ens$
J$ 5ut for the low wages, public sector banks are one of the dream destinations for
thousands of aspiring youth in the country$
M$ ,ublic +ector 5anks as a group are the second largest employer, next only to
#ndian 3ailways, providing employment to lakhs of unemployed youth$
9$ ,ublic +ector 5anks as commercial entities and the staff working in them are one
of the ma'or contributors to governmentEs kitty, as they are one of the few honest
tax paying groups$
10$ 7nder the guidance and supervision of 35#, public sector banks play a vital role
in managing the precious foreign exchange assets of the country$
11$ 5anking 3egulation (ct, 1989 and <egotiable #nstruments (ct, 1MM1 are two
important (cts of 7nion of #ndia, which broadly govern the functioning of
general banking in #ndia$
1"$ 5anking policies and operational guidelines are broadly designed by Department
of 1inancial +ervices, 1inance 0inistry, =overnment of #ndia and the banking
industry is monitored and controlled by the government, in association with 35#$
1D$ 5ank ?olidays are decided by the respective +tate =overnments and published in
official ga6ettes$
18$ ,ublic +ector 5anks issue 5ank =uarantees on behalf of K,resident of #ndia-$
1.$ #n 19J9, Central =overnment had accepted ,illai committee recommendation on
the point that the 5ank officers- salary will be e&ual to that of Class 1 officers$
5y doing this, the central government has indirectly admitted that public sector
bank employees are to be treated on e&ual footing with the government
employees$
1$ Central government uses ,+5s for various purposes like Tax collection,
implementation of socio!economic policies of the nation vi6$ targeted lending
(priority sector lending), distribution of subsidies and grants, financial inclusion
etc$
1J$ 5ank employees are invited to apply for vacancies on deputation basis in
institutions like D3T, C5#, 1#7!#<D, #5( etc$
1M$ 5ank staffs are drafted for election duties by *lection Commission of #ndia$
19$ 5ank 0anagers are empowered to attest certain documents for limited purposes,
by the government$
"0$ +uccessive 1inance 0inisters have acknowledged the fact that only because of
the public sector banks in #ndia, we as a nation could successfully insulate
ourselves against the tribulations that 'olted the +outh *ast (sian Countries in the
late 1990s, the global recession that turned the economy of several (merican
+tates topsy!turvy in "00M!10 and the very recent crisis that enveloped the
*uropean nations like +pain, =reece, #taly etc
"1$ $Last but not the least, public sector banks generate very substantial revenue for
the 7nion =overnment, by way of issuance of dividend on their shares
""$ volume and varieties of work handled by bank employee are beyond comparison
"D$ The productivity per employee, business per employee and branch and
profitability of public sector banks ahs enhanced many folds$
"8$ I$ "# &er$"%e%$ $o me%$"o% here $ha$ F
$h
Pa Comm"##"o% ha# (ee% co%#$"$+$e
for re-"#"o% of #alar"e# of ce%$ral go-er%me%$ em&loee#, 'herea# (a%)
em&loee# are e$ $o ca$ch $he #alar"e# $he are ge$$"%g a# &er <
$h
Pa
Comm"##"o% re&or$1
".$ There is steep raise in C,# inflation and the salaries in absolute terms have also
been eroded$ consumer price index ahs already increased by 1.01 numbers over
8880 which was prevailing on 01!11!"01" i$e$ the level at which #5( ahs agreed
to merge the D( with basic pay
"$ (nd above all there is a danger of pouching of the existing young and trained
staff of public sector banks by new generation of private sector bans and foreign
banks which will merge as per banking policy$
HENCE OUR DE2AND FOR 25 % HIKE IS JUST AND RI5HT1
*ven with "./ hike we will 'ust be inching towards some semblance of parity with pay
of government employees if we evaluate the pro'ected salary in anvil in the wake of
Jthe pay commission$
1riends
The ca&ac"$ $o &a "# %e-er $he #$a%!ar! of a% ca&"$al"#$ 'he% he #$ar$# a%
"%!+#$r1 They study the market some where they find the rate of profit to be "0,
somewhere D0 and some where .0$ They try to cash on it and come with their
accumulated capital, reserves or some things 4 3s$ . crores or 3s$ 10 crores and put it in
to much machinery, so much raw material and go on hunting for the worker see at what
will they can buy the labour power$ Then they calculate that if the labour power is
purchased 3s$10 a day their rate of profit will go down from 3s$.0 to D0$ +o they
reduce the rate1 So $he ca&ac"$ $o &a "# reall $he ca&ac"$ $o ear% $he h"ghe#$ ra$e
of &rof"$$ A%! 'e >The $ra!e U%"o%? cha%ge $he 'age ra$e +& ( (arga"%"%g, (
orga%"#"%g o+r#el-e# a%! ( #$r")e#1 So ca&ac"$ $o #$r")e !e$erm"%e $he ca&ac"$ $o
&a o% $he &ar$ of $he em&loer1 The ca&ac"$ $o &a "# %o$ a% a(#$rac$,
+%(rea)a(le "%-"ola(le &r"%c"&le#1 I$ "# a !e$erm"%a(le $h"%g !e$erm"%e! ( $he
ra$e of &rof"$ a%! ca&ac"$ of $he 'or)er $o (arga"% a%! #$r")e for "$1 A# $he $ra!e
+%"o% ma"%$a"%, "$ "# %o$ $he "%!+#$rC# allege! ca&ac"$ $o &a $ha$ "# ma$er"al $o
+rge f"8a$"o% &+$ $he 'or)er# ca&ac"$ $o 'or) '"$ho+$ 'h"ch $here ca% (e %o
&ro!+c$"o%$
+o long as there is a high volume of <,(s in banks, there cannot be defined, expected
profits $<,( is not our creation$ +o we cannot accept this shallow and unfounded logic
of capacity of the banks to pay$ #f that be the case wage hike for government employees
cannot be granted unless The central government brings down the current account
deficit to ESeroE ,the fiscal deficit to ESeroE (C(D was at 3s$"1,000 crores for "01D!18
as per the news item in <DTA ,rofit on "1!0.!"018$ 1iscal deficit was at 3s$.19,."9
Crores for "01D!18 as per the news item published in various newspapers$
#f the central government recovers a fraction of <,( which around six lakh crores
through stringent legislations and measures and further recovers the huge tax arrears
due from big industrial houses, large corporate groups, 0<Cs and high net worth
individuals (?<#s), in #ncome Tax, +ervice Tax, Customs Duty, *xcise Duty, ,roperty
Tax etc$ in full /Income Tax arrears alone stood at 0s#345,555 crores as at the end of
6arch, 75892, bank and government employees can be easily granted 'ust share of
value added in the forms of 'ust wage revisions$
#n view of the aforesaid principles laid by #ndian 'urisprudence , for bank employees
our demand of ". / hike in pay slip components is fair , 'ust meets ends of 'ustice and
should be sei6ed form unyielding hands no holds barred$
#f today in our anxiety to secure arrears and marginal increase in wages, we
compromise on principles in accepting their unreasonable, irrational demands,
tomorrow we will be compelled to sign on dotted lines even in matters suicidal to our
interest
This in short is the emerging scene and engulfing situation$ 2e know that wages or
privileges we get today are not charity of #5($ #t is the heritage and legacy of our
sustained struggles and inspiring sacrifices$ 2e have survived furious storms and gusty
winds$ 2e know as a responsible 7nion, when to organise and how to agitate$ 2e
have the glorious past, potential present and challenging future$
Therefore let history record that in spite of the greatest odds 5ank employees
irrespective of their union affiliations would stand up and resist in'ustice and re'ect
with disdain and contempt the demands of #5(
%ur response to #5(-s offer can only be our unity$ Let us demonstrate once for all that
the dedication and conviction we have in upholding our dignity cannot be high 'acked
by #5( nor it can be purchased or bartered$ Let the world know our consciousness is
not for sale$
2e are sure you will draw appropriate conclusions and proper decisions in this regard$
(+ee (nnexure ()
ANNEXURE A
MONTHLY SALARY OF CENTRAL GOVERNMENT STAFF AND BANK
STAFF (OTHER THAN OFFICERS) AS ON 01-08-2013 A COMARISON
@ar"o+#
Com&o%e%$#
of 2o%$hl Pa
Ce%$ral 5o-$1
S$aff
(!" #$ B#"%
1)
S+(;#$aff "%
3a%)#
Ce%$ral 5o-$1
S$aff
(!" #$ B#"%
2)
Cler"cal #$aff
"% 3a%)#
5asic ,ay 8,M0 .,M.0 M,J00 J,"00
=rade ,ay 1,M00 N I : 8,"00 N I :
+pecial ,ay /at the
minimum for ban!
staff2
N I : D80 N I : .00
To$al <,<<0 <,/70 /2,700 F,F00
Dearness (llowance
.,998
/;<5=2
.,.0
/;44#<3=2
11,10 ,M89
?$3$($
1,99M
/;>5=2
19
/;85=2
D,MJ0 JJ0
C$C$($
N I : N I : N I : N I :
*ducation
(llowance
/maximum for 7
children2
",.00 355 ",.00 .00
Transport (llowance
1,180
(00T90/ D()
"".
D,080
(1,00T90/
D()
"".
+taff
2elfareP,rovisions
N I : .00 N I : .00
<ewspaper N I : 100 N I : 100
5ro## 2o%$hl
#alar
/H,272 /:,<=0 ::,720 /<,<==
CHAPTER 6 II
JUSTIFICATION IID
NEED TO REIFG HISTORIC DISTORTIONS IN 3ANK E2PEOGEES
SCAEES OF PAG
1or convenience and proper presentation this JUSTIFICATION 2 is set forth under
paras (, 5, C$
() There is a popular belief that the wages of bank employees stand stands when
compared with government and other public sector undertakings after the advent of
the pay commission$ This is a misnomer$ The reality is that the wages of bank
employees when compared with other peers in the industry has lagged behind ever
since .
th
bipartite settlement$ #n proof thereof # give the following facts$ These
figures shall stunt our conscience as how we ranked with other peers right from .th
bipartite$
The study based on agreements of ma'or ,ublic +ector 7n! dertakings in #ndia and a
comparative study with bank employees was published by +hri$ (rvind +hrouti on
behalf of 0aniben >ara #nstitute (?0+) in @uly 1991will unveil the truth$ The
following undertakings are covered in this study!
+l$ <o$ <ame of the 7ndertaking (bbreviations
1$
"$
D$
8$
.$
$
J$
M$
9$
10$
11$
1"$
1D$
18$
1.$
1$
1J$
1M$
19$
.
th
,ay Commission
<ationalised 5anks
5harat *arth 0overs Limited
5harat *lectronics Limited
5harat ?eavy *lectricals Ltd
Coal #ndustry
?industan (eronautics Ltd
#ndia 1armers 1ertili6ers Coop$ Ltd
#ndia Trade ,romotion %rgani6ation
#ndian Tourism Development Corp$ Ltd$
Life #nsurance Corporation
0adras 1ertili6ers Limited
0other Dairy
0ahanagar Telephone <igam Ltd
<ational Thermal ,ower Corp$ Ltd
%il #ndia
%il B <atural =as Commission
,orts B Docks
3eserve 5ank of #ndia
UUU
5anks
5*0L
5*L
5?*L
C%(L
?(L
#11C%
#T,%
#TDC
L#C
01L
)
0T<L
<T,C
)!
%<=C
)!
35#
# give below the genesis of this very informative thought provoking study which will
provoke the conscience of the bank employees that we they did not get fair deal in wage
revisions right form 1991 onwards$ These historic blunders cascaded during the
subse&uent wage revision too, widening the disparity of bank employees with
comparable peers like central government, insurance, 35# employees, leave alone other
,+7 undertakings tilting $he #cale# of 6+#$"ce of $he !oc$r"%e of e*+al 'or) e*+al
&a1
9age "% P+(l"c Sec$or "% I%!"a
; A com&ara$"-e #$+! '"$h 3a%) Em&loee# 9age# ;
TOTAE 9A5ES >INCEUDIN5 AEEO9ANCES? OF
SU3 STAFF AT @ARIOUS STA5ES OF PAG
>Arra%ge! "% !e#ce%!"%g or!er?
Ra%)
/
ST
STA5E
5
TH

STA5E
/0
TH
STA5E
/5
TH
STA5E
20
TH
STA5E
25
H
STA5E
1
1"DDJ
#11C%
1D.19
0D
1.1D0
0D
1J
0D
1MD08
0D
1980
0D
"
1""90
0%T?*3
D(#3G
1D1D0
#11C%
18198
#11C%
1.J0"
%<=C
1J880
%<=C
19.0M
%<=C
D
1""8.
#T,%
1"JM
#T,%
18090
%<=+
1.DM.
%#L #<D#(
1J"80
%#L #<D#(
19DDM
%#L #<D#(
8
11J.9
%<=C
1"JD"
%<=C
1DJ1
%#L#<D#(
1.1MD
#11C%
11J"
#11C%
1J.D0
0T<L
.
111M.
%#L #<D#(
1""""
%#L #<D#(
1D.DJ
#T,%
18J0
0T<L
11.0
0T<L
1J88"
<T,C

111J"
01L
1"08.
01L
1D"90
0T<L
18D0.
01L
1.D9
01L
1J"8"
#11C%
J
10JD1
0T<L
11MD.
0T<L
1D"18
01L
18"1D
#T,%
1."DD
<T,C
1.91
01L
M
10.MJ
5?*L
11.D8
5?*L
1"M9
5?*L
1D90M
5?*L
1.0.D
5?*L
1"9J
5?*L
9
98
<T,C
10818
<T,C
1JM
<T,C
1D81D
<T,C
18M90
#T,%
1..
#T,%
10
9D
#TDC
991M
#TDC
100J
#TDC
11D.8
#TDC
1D10
35#
1."8.
35#
11
M911
,%3T+ B
D%C>+
98"
5*L
1010
C%(L
110.
C%(L
1"8J1
C%(L
1D8.1
C%(L
1"
MMM.
5*L
9811
,%3T B
D%C>
101DJ
5*L
10M..
5*L
1""M
C%(L
1D018
#TDC
1D
M0"
5*0L
9""0
C%(L
100
,%3T B
D%C>
10M8J
,%3T+ B
D%C>
1"1"J
,%3T B
D%C>
1"90J
,%3T B
D%C>
18
M89
C%(L
918D
5*0L
9M.8
5*0L
10.J"
5*0L
11.M8
5*L
1"D1"
5*L
M"1" M9 9"MD 10.8. 11D00 1"0"9
1. ?(L ?(L ?(L 35# 5*0L 5*0L
Ra%)
/
ST
STA5E
5
TH

STA5E
/0
TH
STA5E
/5
TH
STA5E
20
TH
STA5E
25
H
STA5E
/<
F2::
5
TH
PAG
CO22ISS
ION
F7FH
5
TH
PAG
CO22ISS
ION
H707
5
TH
PAG
CO22IS
SION
770F
HAE
/0H=<
5
$h
&a
//FF<
5
TH
PAG
/F
<07F
R3I
<H50
R3I
H5F=
R3I
PH:7
5
$h
&a
/05<<
HAE
///7/
HAE
/H
52H2
EIC
<0F2
EIC
F/0<
EIC
H/H<
EIC
7520
EIC
//0/F
EIC
/7
5/::
BANKS
5<0F
BANKS
<5:H
BANKS
FF<0
BANKS
72/:
BANKS
/0F:0
BANKS
A@ERA
5E
7:<< /0/:2 //20/ /2::< /:<27 /=H7<
RATIO
OF
2INI D
2AAI
/D21=0 /D21=/ /D21:/ /D21/5 /D/77
/D/1H5
SIGNIFICANT FINDINGS AND ANALYSIS
2hen one compares the minimum wages paid in various ,+7-s on finds a good
deal of variation$ 2ages vary not only with the level of skills of the employees
but also with the industries or units$
(s far as the &uantum of wages in these units is concerned one finds that wages
in the 5anking industry at the recruitment stage are low for sub staff i$e$ 3s$ .1DD
p$m$ at "00 C,#$ 2hile for the same level wages paid in #11C% are very high
3s1"DDJ$ The wage disparity ratio at the said level is 1:"$80$ The average total
wage of sub staff at the recruitment level is 3s 9D$ (t the ".
th
stage is the
lowest i$e$ 3s10DJ0 B and 0%T?*3 D(#3G is ?ighest i$e$ 19M80$
2ages for clerical staff at recruitment level on "00 C,# again bank is the lowest
i$e$ 3s$..J9, while for the same level wages paid in #11C% are very high i$e$ 3s$
190JJ$ The wage disparity ratio is 1:8" at this level$ (t the ".
th
stage of clerical
staff ?(L is the lowest, i$e$ 3s$ 1M8D0 B %<=C is the highest$ i$e$ 3s$ DD8..$
The average wage for clerical staff at recruitment level is 3s$1"198$ ?ere again
in most stages bank employees are paid less than the average$
A$ o%e $"me 3a%)"%g I%!+#$r 'a# $he #eco%! h"ghe#$ &a"%g orga%".a$"o%
>cler"cal gra!e Ia$ h"gher #$age#? '"$h"% PSUC#1 3+$ %o' $ha$ "# %o$ $he ca#e1
A$ ha$ $"me "% mo#$ of $he PSUCS a fla$ ra$e D1A1 'a# "% e8"#$e%ce a%! -er
fe' +%!er$a)"%g# ha! !o+(le l"%)age D1A J a%! 3a%) 'a# o%e of $hem
1No' mo#$l all PSUCS ha-e !o+(le l"%)age D1A #cheme '"$h /00%
%e+$ral".a$"o% a$ al le-el#1
(verage ?3( for sub staff in 5anking industry is 3s$D8. which is lowest while
at the same level %#L #<D#( is the highest i$e$ 3s$ 19"$ 1or the clerical grade
also the situation is the same$ The reason behind such scenario is the rate of
?3($ #n 5(<>#<= industry the ?3( is paid ; M$./ while in most of ,+7-s
this rate is D0/(( T cities)
%ther allowances paid in most of the ,+7-+ are very high as compared to banks$
The average of total allowances in banking industry is 3s J"D while for the same
level it is 3s$8.88 in 0%T?*3 D(#3G$ This is also one of the ma'or factors
contributing to huge wage disparity between banking sector and other ,+7-s$
There is no much increase in real wages of 5ank employees as compared to other
,+7-s$ #n the period of last 1" years the wage growth in 5(<>#<= industry is
nearer to growth in (#C,#$ #n short the real wages are maintained in banking
industry$ 2hile in other ,+7-s there is a fantastic raise in real wages$

#nference: bank employees are high wage island is a canard$ %ur charter in the
A### 5ipartite 2age 3evision is therefore 'ust and right$
5) #n (nnexure ( reproduced again in the @ustifications # had given the comparison
of monthly &#'#($ )* +,"-(#' .)/,("0,"- &-#** #"% 1#"2 &-#** ()-3,( -3#"
)**!+,(&) #& )" 01-08-20134 A +')&, &+(5-!"$ )* -3, &#0, 6!'' (,/,#' -3#- +ub
+taff and clerks already lag behind The Central =overnment *mployees by
".$8D/ and .0$9D/
ANNEXURE A
MONTHLY SALARY OF CENTRAL GOVERNMENT STAFF AND BANK
STAFF (OTHER THAN OFFICERS) AS ON 01-08-2013 A COMARISON
@ar"o+#
Com&o%e%$#
of 2o%$hl Pa
Ce%$ral 5o-$1
S$aff
(!" #$ B#"% 1)
S+(;#$aff "%
3a%)#
Ce%$ral 5o-$1
S$aff
(!" #$ B#"%
2)
Cler"cal #$aff
"% 3a%)#
5asic ,ay 8,M0 .,M.0 M,J00 J,"00
=rade ,ay 1,M00 N I : 8,"00 N I :
+pecial ,ay /at the
minimum for ban!
staff2
N I : D80 N I : .00
To$al <,<<0 <,/70 /2,700 F,F00
Dearness (llowance
.,998
/;<5=2
.,.0
/;44#<3=2
11,10 ,M89
?$3$($
1,99M
/;>5=2
19
/;85=2
D,MJ0 JJ0
C$C$($
N I : N I : N I : N I :
*ducation
(llowance
/maximum for 7
children2
",.00 355 ",.00 .00
Transport (llowance
1,180
(00T90/ D()
"".
D,080
(1,00T90/
D()
"".
+taff
2elfareP,rovisions
N I : .00 N I : .00
<ewspaper N I : 100 N I : 100
5ro## 2o%$hl
#alar
/H,272 /:,<=0 ::,720 /<,<==
S)5(+,7 3--87996664#''1#"2!".&)'5-!)"&4+)09:#.,-R,/!&!)"9X-3-B!8#(-!-,-
S,--',0,"-9C)08#(#-!/,-S#'#(!,&-!"-G)I43-0
#n respect of officers the disparity stand more pronounced as the following cogent, pellucid reasoning and statistics will
reveal$
6?NT@:A .:.0A ?, C+NT0.: G?B+0N6+NT ?,,IC+0 .NC 1.ND ?,,IC+0 . ?N 58E54E758> F
. C?6$.0I?N
@ar"o+# Com&o%e%$#
of 2o%$hl Pa
Ce%$ral
5o-er%me%$
Off"cer# (!" #$
B#"% 3
S-#., I)
3a%) Off"cer#
"% J25S I
Ce%$ral
5o-er%me%$
Off"cer# (!" #$
B#"% 3
S-#., II)
3a%) Off"cer#
"% 225S II
Ce%$ral
5o-er%me%$
Off"cer# (!"
#$ B#"% 3
S-#., III)
3a%) Off"cer#
"% 225S III
5asic ,ay 1.,00 18,.00 1M,9D0 19,800 "1,900 ".,J00
=rade ,ay .,800 < # L ,00 < # L J,00 < # L
To$al of 3a#"c K 5ra!e Pa 2/,000 /=,500 25,5:0 /7,=00 27,500 25,F00
Dearness (llowance
1M,900
/;<5=2
1",M9M
/;44#<3=2
"",9JJ 1J,". ",..0 "",M0
?$3$($
,D00
/;>5=2
1,"DD
/;4#3=2
J,.9 1,89 M,M.0 ",1M.
C$C$($
(0aximum;8/ for bank officers) < # L .80 < # L .80 < # L .80
*ducation (llowance /maximum for
7 children2
",.00 < # L ",.00 00 ",.00 1,000
Transport (llowance P 0onthly
Conveyance
,0M0
(D,"00T90/
D()
","00
(D0 litres of
petrol)
,0M0
(D,"00T90/
D()
D,000
(80 litres of
petrol)
,0M0
(D,"00T90/
D()
D,J.0
(.0 litres of
petrol)
+taff 2elfare < # L .00 < # L .00 < # L .00
+taff *ntertainment *xpenses /pro
rata2
< # L D00 < # L 800 < # L .00
5ro## 2o%$hl #alar 5=,FH0 :2,/F/ <=,F=< =:,:=5 F:,=H0 5F,0:
S)5(+,7 3--87996664#''1#"2!".&)'5-!)"&4+)09:#.,-R,/!&!)"9X-3-B!8#(-!-,-
S,--',0,"-9C)08#(#-!/,-S#'#(!,&-!"-G)I43-0
LI% &ro&or$"o% $herefore, a# $he re&+l#"-e%e## of $he 'or) "%crea#e#, $he 'age
!ecrea#e#1M N Karl 2ar8, The Comm+%"#$ 2a%"fe#$o1
3icardo developed a theory of distribution within capitalism, that is, a theory of how
the output of society is distributed to classes within society$ The most mature version
of this theory, presented in %n the ,rinciples of ,olitical *conomy and Taxation, was
based on a labour theory of value in which the value of any produced ob'ect is e&ual
to the labor embodied in the ob'ect$ ((dam +mith also presented a labor theory of
value but it was only incompletely reali6ed$) (lso notable in 3icardoEs economic
theory was that profit was a deduction from societyEs output and that wages and profit
were inversely related: an increase in profit came at the expense of a reduction in
wages$ 0arx built much of the formal economic analysis found in Capital on
3icardoEs theory of the economy$ 2ar8 em&loe! a la(o+r $heor of -al+e, 'h"ch
hol!# $ha$ $he -al+e of a commo!"$ "# $he #oc"all %ece##ar la(o+r $"me
"%-e#$e! "% "$1 I% $h"# mo!el, ca&"$al"#$# !o %o$ &a 'or)er# $he f+ll -al+e of $he
commo!"$"e# $he &ro!+ceO ra$her, $he com&e%#a$e $he 'or)er for $he
%ece##ar la(or o%l >$he 'or)erP# 'age, 'h"ch co-er o%l $he %ece##ar mea%#
of #+(#"#$e%ce "% or!er $o ma"%$a"% h"m 'or)"%g "% $he &re#e%$ a%! h"# fam"l "%
$he f+$+re a# a gro+&?1 Th"# %ece##ar la(or "#, 2ar8 #+&&o#e#, o%l a frac$"o% of
a f+ll 'or)"%g !a ; $he re#$, $he #+r&l+#;la(or, 'o+l! (e &oc)e$e! ( $he
ca&"$al"#$1
0arx theori6ed that the gap between the value a worker produces and his wage is a
form of unpaid labour, known as surplus value$ 0oreover, 0arx argues that markets
tend to obscure the social relationships and processes of productionO he called this
commodity fetishism$ ,eople are highly aware of commodities, and usually donEt
think about the relationships and labour they represent
>arl 0arx argues in Capital that Fthe relation between wage!labor and capital
determines the entire character of the VcapitalistW mode of production$ Due to the
functioning of the market, the way that exploitation takes place under capitalism is
more disguised than in previous modes of production$ (n important tool in
uncovering this process is 0arx-s Flaw of valueF or Flabor theory of value$F 0arx
theori6ed that the gap between the value a worker produces and his wage is a form of
unpaid labour, known as surplus value$ 0oreover, 0arx argues that markets tend to
obscure the social relationships and processes of productionO he called this
commodity fetishism$ ,eople are highly aware of commodities, and usually donEt
think about the relationships and labour they represent$
2ith these clear understandings he philosopher >arl 0arx said
DD
O%e fac$or "% re#$or"%g &rof"$a(le acc+m+la$"o% "# a !e&rec"a$"o% "% $he &r"ce of
-ar"a(le ca&"$al >'or)er#C la(or &o'er?I"% o$her 'or!#, a re!+c$"o% "% $he 'age#
a%! (e%ef"$# &a"! $o 'or)er#$ 0arx summari6es this process as follows: Fthe
stagnation of production would have laid off a part of the working class, and would
thereby have placed the employed part in a situation where it would have to submit to
a reduction of wages even below the average$ This has the very same effect on capital
as an increase of$$$surplus value at average wages would have had1 A co%$em&orar
e8am&le of $h"# &roce## "%-ol-e# $he com&+$er #of$'are "%!+#$r1 Tech%olog
'or)er# &erform a% a-erage of 50 ho+r# of 'or) &er 'ee), e$ '"$h rece%$
"%crea#e! laoff#, are acce&$"%g lo'er a%! lo'er 'age# a%! #alar"e# for $he"r
'or)1 A$ $he #ame $"me, $he are &ro!+c"%g $he #ame >a%! #ome$"me# more?
-al+e for $he"r em&loer1 Th"# fac$ hel&# re#$ore a%! "%crea#e $he ca&"$al
acc+m+la$"o% of a #ec$"o% of $he ca&"$al"#$ cla##1
*conomic crisis also produces desperate attempts by capitalists to shore up their
profits at the expense of each other$ (s 0arx notes, Fas soon as it is no longer a
&uestion of sharing profits, but sharing losses, everyone tries to reduce his own share
to a minimum and to shove it off upon another1111 Ho' m+ch each "%!"-"!+al
ca&"$al"#$ m+#$ (ear of $he lo##, "1e1, $o 'ha$ e8$e%$ he m+#$ #hare "% "$ a$ all, "#
!ec"!e! ( #$re%g$h a%! c+%%"%g, a%! com&e$"$"o% $he% (ecome# a f"gh$ amo%g
ho#$"le (ro$her#1 For e8am&le, 'he% fac"%g &ro(lem# "% e8$rac$"%g #+r&l+# -al+e
from 'or)er#, or "% real"."%g #+r&l+# -al+e, ca&"$al"#$# '"ll of$e% &refer $o +#e
$he"r Q"!le mo%eQ for &+r&o#e# of #&ec+la$"o% "% $h"%g# #+ch a# #$oc)# or
c+rre%c"e#, ra$her $ha% "%-e#$"%g "% %e' ca&"$al1 Th"# occ+r# a$ $he e%! of e-er
(+#"%e## ccle a# &rof"$# (eg"% $o !ecl"%eO he%ce $he Q"rra$"o%al e8+(era%ceQ of
$he #$oc) mar)e$ 2ar8P# a%al#"# lea!# $o $he co%#"!era$"o% of eco%om"c cr"#"#$
QA &ro&e%#"$ $o cr"#"#R'ha$ 'e 'o+l! call 15&!",&& +$+',&R'a# %o$ recog%"#e!
a# a% "%here%$ fea$+re of ca&"$al"#m of ( o$her eco%om"#$ of 2ar8P# $"me,Q
o(#er-e! Ro(er$ He"l(ro%er "% T3, :)('%'$ 3!')&)83,(&, Qal$ho+gh f+$+re
e-e%$# ha-e cer$a"%l "%!"ca$e! h"# &re!"c$"o% of #+cce##"-e (oom a%! cra#h
"%cl+!"%g The Rece%$ 5lo(al Eco%om"c Rece##"o% Cra#h Of 200H
Th"# "# a# $r+e $o!a a# "$ 'a# o-er /50 ear# ago a# #a"! ( $he grea$
&h"lo#o&her of 'or)"%g cla## ;Karl 2ar81
C? Pr"or $o /7F7, 5ro+& BAC Off"cer# of Ce%$ral 5o-er%me%$ 'ere ear%"%g le##
$ha% (a%) off"cer#1 I% /7F7, $he P"lla" Comm"$$ee 'a# co%#$"$+$e! $o #$+!
$he #alar #$r+c$+re# of (a%) off"cer# a%! 5ro+& BAC Off"cer# of $he Ce%$ral
5o-er%me%$ a%! (r"%g e*+"$ amo%g -ar"o+# (a%)#1
D8
The Comm"$$ee o(#er-e! $ha$ $he f+%c$"o%# a%! re#&o%#"("l"$"e# of (a%) off"cer#
"% $he %e' #e$;+& 'ere com&ara(le $o $ho#e of 5ro+& BAC Off"cer# "% $he Ce%$ral
5o-er%me%$ a%! #+gge#$e! &a &ar"$ (e$'ee% $hem1
The P"lla" Comm"$$ee recomme%!a$"o%# 'ere "m&leme%$e! "% (a%)# '"$h effec$
from J+l /, /7F7, a%! $he &a #cale of $he lo'e#$ r+%g of off"cer# "% (a%)# 'ere
e*+a$e! '"$h &a #cale# of $he lo'e#$ r+%g of 5ro+& BAC Off"cer# of Ce%$ral
5o-er%me%$ a$ R# F001
The &ar"$ 'h"ch 'a# e#$a(l"#he! ( "m&leme%$"%g $he P"lla" Comm"$$ee
Recomme%!a$"o%# 'a# !"#$or$e! ( #+(#e*+e%$ Pa Comm"##"o% re-"#"o%#1 I%
$he S"8$h Pa Comm"##"o%, $he 'age# of 5ro+& BAC Off"cer# .oome! &a#$ $he
(a%) off"cer#C 'age#1 E8$er%al rela$"-"$ 'a# g"-e% a *+"e$ (+r"al1
I$ "# *+"$e a&&ro&r"a$e $o com&are $he #alar of (a%) off"cer# '"$h 5ro+& BAC
Off"cer# of $he Ce%$ral 5o-er%me%$ $o a#cer$a"% 'he$her (a%) off"cer#
co%#$"$+$e a h"gh;'age "#la%!1
The (a#"c &a accor!"%g $o $he F"f$h Pa Comm"##"o% for 5ro+& BAC Off"cer#
'a# R# H,000 a%! $he corre#&o%!"%g &a for (a%) off"cer# 'a# R# F,/001 3+$ "%
$he S"8$h Pa Comm"##"o% $he (a#"c &a for 5ro+& BAC Off"cer# of $he Ce%$ral
5o-er%me%$ 'e%$ +& $o R# 2/,000 >(a#"c &a R# /5,<00 K gra!e &a R# 5,=00?
'herea# $he &re;re-"#e! (a#"c &a of (a%) off"cer# 'a# o%l R# /0,0001
3e$'ee% $he F"f$h a%! $he S"8$h Pa Comm"##"o%#, $he (a#"c &a of 5ro+& BAC
5o-er%me%$ off"cer# 'e%$ +& ( /<215 &er ce%$1
The gro## #alar of go-er%me%$ off"cer# 'a# R# :/,:/2, 'herea# $he (a%)
off"cerC# #alar 'a# o%l R# /<,//01 I$ ca% (e #ee% $ha$ a (a%) off"cer !ra'# a
gro## #alar 'h"ch "# 6+#$ 5/1=5 &er ce%$ of $he gro## #alar of 5ro+& BAC off"cer#
a$ $he lo'e#$ r+%g1
E-e% ho+#e re%$ allo'a%ce 'a# &a"! a$ :0 &er ce%$ of (a#"c &a for go-er%me%$
off"cer#, 'herea# (a%) off"cer# 'ere ge$$"%g a ma8"m+m of H15 &er ce%$ "%
me$ro#1 The &re;re-"#e! #alar of $he (a%) cler) 'a# R# <,<00 a# com&are! '"$h
$he Ce%$ral 5o-er%me%$ cler)C# #alar of R# //,0001
2a% S$a$e 5o-er%me%$# ha-e a!o&$e! $he S"8$h Pa Comm"##"o%
Recomme%!a$"o%#1 A %+m(er of &+(l"c #ec$or +%!er$a)"%g# ha-e "m&leme%$e!
$he Pa Comm"##"o% recomme%!a$"o%# a# a (e%chmar) for $he"r #alar re-"#"o%1
The Ce%$ral 5o-er%me%$ Em&loee ge$# $he &e%#"o% 50% of $he h"# a-erage
emol+me%$# &er of $he la#$ mo%$h (efore h"# S+&era%%+a$"o% from $he
D.
co%#ol"!a$e! f+%! from $he 5o-er%me%$ of I%!"a 'ho 6o"%e! (efore 200= 'h"le
$he (a%) Em&loee !oe# %o$ ge$ "$ from $he co%#ol"!a$e! f+%! of 5o-er%me%$ of
I%!"a1
For $he Ce%$ral 5o-er%me%$ Em&loee# "% $he &a#$, $he re-"#e! #cale# are clo#e
$o :00% >: $"me#? e-er $"me, "% $he /0 ear# ccle1 I% ca#e of (a%)er#, $he
re-"#e! #cale# are /50% >/150 $"me#? af$er re-"#"o% o%ce "% 5 ear#1 Th+# "% each
ccle of /0 ear#, $he re-"#"o% amo+%$# $o 225% >2125 $"me#? for (a%) #$aff1
Prec"#el (eca+#e of $h"# rea#o%, o+r 'age# ha-e co%#"#$e%$l come !o'%
rela$"-el1 To!a, 'e ha-e #+%) $o $he (o$$om, from $he $o& &o#"$"o% 'e e%6oe!
:0 ear# ago1
O+r HRA 'he% com&are! '"$h Ce%$ral 5o-er%me%$ #$aff J a%! PSU $he
##$em ra$e# >-ar"%g from /0% $o :0% of $he re-"#e! (a#"c &a?1 R"gh$ form 5
$h
("&ar$"$e o%'ar!# "# $he lo'e#$
If 'e com&are $he l"m"$e! 'or)"%g ho+r# a !a a%! 5 !a 'ee) for ce%$ral
go-er%me%$ em&loee# , off"cer# "% &ar$"c+lar (a%) off"cer# %ee! $o (e &a"!
a!!"$"o%al amo+%$ for $he e8$ra ho+r# 'or)e! > =0%? more $ha% $he
go-er%me%$ off"cer#1
NOTED The !ema%! of go-er%me%$ em&loee or em&loee# of f"%a%c"al #ec$or
"%cl+!"%g 3a%)"%g , for $ha$ ma$$er a% #ec$"o% of $he 'or)"%g cla## for 6+#$
'age# a%! #er-"ce co%!"$"o%# ha# a%$"mo%o&ol co%$e%$ a%! $herefore $he are
%o$ %o%;a%$ago%"#$"c1 O+r "%$ere#$# a%! $ha$ of go-er%me%$ em&loee# are
com&leme%$ar a%! %o$ co%$ra!"c$or1 9e '"#h $o +%!er#core here $ha$
go-er%me%$ em&loee# !e#er-e f+r$her a%! a##+re $hem of (a%) em&loee#C
#ol"!ar"$ $o $he"r 6+#$ ca+#e "% $+%e '"$h o+r #loga% 6)(2!". +'#&& 5"!-$
;!"%#1#%! For f+r$her "m&ro-eme%$# a%! -al+e a!!"$"o%# "% $he F
$h
&a
comm"##"o%1 Nor !o 'e e%- 5o-er%me%$ Em&loee# ge$$"%g (e$$er #hare of
'age# "% $he <
$h
&a comm"##"o%1 All $ha$ 'e are em&ha#"."%g a%! !ema%!"%g "#
#em(la%ce of &ar"$ '"$h $he Ce%$ral 5o-er%me%$ Em&loee# 'age# a# o% !a$e
a# $he Ce%$ral 5o-er%me%$ 'h"ch $he real o'%er of $he P+(l"c Sec$or 3a%)# "%
I%!"a a# a mo!el em&loer "# !+$ (o+%! l")e all orga%# of S$a$e #ho+l! (e
comm"$$e! $o $he D"rec$"-e Pr"%c"&le# of S$a$e Pol"c a%! Ar$"cle :7 'h"ch
e%#hr"%e# $he &r"%c"&le of e*+al &a for e*+al 'or)

The -ol+me of a%! -ar"e$"e# of 'or) ha%!le! ( (a%) em&loee# are (eo%!
com&ar"#o%1
,ublic sector banks are re&uired to perform all types of non productive work such as
payment of pension, old age pension, 0(<3*=( payment, teacher salary payment,
tax collection, shoulder the responsibility of target for 1inancial #nclusion fixed by
D
the government$ 3ecently The ,rime 0inister has already sent J$". lakh emails to
bank officers informing them about the financial inclusion scheme ,0@DG, which he
had announced in his #ndependence Day address to the nation$ The ,0@DG has been
conceived as a national mission on financial inclusion with the ob'ective of covering
all households in the country with banking facilities and having a bank account for
each household$ Transcending the vision of the honorable ,rime 0inster into reality
will involve bank employees working beyond working hours and even on +undays as
per the targets set by the respective banks higher echelon which the conscious bank
employees perform without demur without any additional compensation$
I$ "# al#o a% "rref+$a(le fac$ $ha$ !+r"%g la#$ $'o ear# (a%)# ha-e o&e%e! more
$ha% 5000 (ra%che# "% r+ral area# '"$ho+$ a!!"%g %+m(er "% $he"r $o$al
ma%&o'er1 3+#"%e## of (a%)# ha-e almo#$ !o+(le! '"$ho+$ a% "%crea#e "% $o$al
%+m(er of #$aff 1I% $he %ame of F"%a%c"al e8cl+#"o% , ma%ageme%$ of each (a%)
"# (+# "% ma)"%g effor$ $o &lea#e m"%"#$er a%! forc"%g a-a"la(le #$aff $o 'or) "%
la$e ho+r# a%! o% S+%!a# a%! hol"!a#1 A# #+ch (a%) #$aff# are fac"%g Soc"al
E8cl+#"o% "% $he"r effor$ $o ge$ #+cce## "% F"%a%c"al I%cl+#"o%1
To add fuel to fire public sector banks did not make any employment or made
negligible recruitment since 1991 due to which average age of bank employee in ,+
banks is more than 8. which having deleterious effect to cope with this extra
workload$
#f the working hours, leave and holidays of bank staff and ground realities are taken
into account, bank staff in fact deserve much more than the salaried class of people
from any other part of the society$ #f the risks and responsibilities, link failures and
late sitting are taken as the yardstick, Gris! allowanceH of not less than D0/ of the
5asic ,ay must be paid to all bank staff$
(n overstretched business plan and over exerting pressure on clerical strength due to
continuous depletion, if the present trend continuous will naturally reach a
breakpoint$ #f we take into consideration that M0/ of staff are above 8. years,
marketing of business strategies, may get affected under the weight of work pressures
due to age related problems$

5ro+%! real"$"e#:
?ere # would like to bring to the notice of the readers and top echelons in #5( P
1inance 0inistry, a news item appearing in the ?indu 5usiness Line , august
"8,"01" under the title LChalle%ge for (a%)#D 5e$ &eo&le $o 6o"% +&, #$a7
DJ
0ecentl", at the graduation da" ceremon" in a 1Eschool near 6angalore, some
students approached a former senior ban!er, who is the head of academic council
there, for his blessings before starting off on their career in ban!ing# @e had this
piece of advice for them% 1uild lo"alt" to the organisation "ou wor! for#-
'hen we posed the question of lo"alt" to another ban!er, who heads the regional
office of a public sector ban! in 6angalore, he said% That is for later# The first
challenge is to get people to join the ban!ing sector#-
Citing the example of his ban!, he said there were over <55 vacancies for the post of
officers# .fter completion of the selection process, hardl" 755 among the shortElisted
candidates confirmed their willingness to join# .nd, finall", onl" 75 per cent actuall"
joined the ban!#
:est we thought the problem was unique to his ban!, he hastened to add% This is not
limited to our ban! alone# It is an industr" problem#-
NOT SATISFIED
@ere is another instance% ,our people joined a public sector ban! in 6angalore cit"
as probationar" officers# N) &))",( 3#% -3,$ <)!",% -3, 1#"2= -3#" -3,$ &-#(-,%
&5(*!". -3, N,- *)( 1,--,( )88)(-5"!-!,& !" )-3,( &,+-)(&# . ban!er in the !now of this
happening said the new recruits were told about the benefits of a ban! job visEIE
vis those in other sectors# 1esides, ban!s also offer accommodationJquarters at some
locations#
B5- -3,&, 1,",*!-& %)">- &,,0 -) !08(,&& 0#"$ ,".!",,(& #"% B-&+3))' .(#%5#-,&=
*)( 63)0 # 1#"2 <)1 !& )"'$ # &-)8.#8 #((#".,0,"-# The" join a ban! onl"
because the" want a job# .nd before long, quit to join elsewhere,- said a ban!er in
Coimbatore# 1an!ers feel that management grads and engineers are overqualified
for clerical jobs in a ban!, "et the" appl" and get in because the" want to be
emplo"ed somewhere#
. public sector ban! official sa"s the trend is almost similar in the officer categor"
too#
?E/," !* -3,$ <)!" #& 8()1#-!)"#($ )**!+,(&= -3,$ %)">- &-!+2 )" *)( ')". #& !" -3,
8#&-4 T3,$ #(, !"/#(!#1'$ 8)&-,% -) -3, +(,%!- &,+-!)" #"% #(, &,- (,&8)"&!1!'!-!,&4
T3, 8(,&,"- %#$ $)5-3 !& ")- 8(,8#(,% -) -#2, )" -3, 15(%," )* (,&8)"&!1!'!-$4
Y)5".&-,(& *,,' -3,!( 8#+2#., !& ")- +)00,"&5(#-, 6!-3 -3, 3)5(& -3,$ -)!' !" -3,
1#"24@
S)5(+,7 3--87996664-3,3!"%515&!",&&'!",4+)09!"%5&-($-#"%-,+)")0$
91#"2!".9 +3#'',".,-*)(-1#"2&-.,--8,)8',--)-<)!"-58-&-#$9#(-!+',381A0B04,+
DM
Th"# "# $he gro+%! real"$1 Co%#"!er"%g $he &re#e%$ ra$e of "%fla$"o%, f+$+re
"%fla$"o% a%! $he a%$"c"&a$e! #alar"e# of ce%$ral go-er%me%$ #$aff af$er F$h CPC,
"$ "# (e -er fa"r a%! 6+#$ for $he (a%) #$aff $o !ema%! 25% h")e "% &a #l"&
com&o%e%$ $o re$a"% e8"#$"%g $ale%$# , #$o& e8o!+#, a$$r"$"o% a%! o&e% '"%!o'
for f+$+re $ale%$e! *+al"f"e! o+$h $o $a)e +& 6o(# "% P+(l"c Sec$or 3a%)# a%!
mee$ $he challe%ge# "% ma%&o'er &la%%"%g &o#e! !+e $o $he h+ge re$"reme%$
l")el $o "%c+r from 20/< o%'ar!#$
He%ce "$ "# all $he more "m&era$"-e $ha$ $he 5o-er%me%$ a%! I3A e%#+re# $ha$
$ha$ P+(l"c #ec$or (a%)# ha-e $he +%"form 'age #$r+c$+re a# &re-ale%$ "%
5o-er%me%$ De&ar$me%$# a%! o$her &+(l"c #ec$or +%!er$a)"%g#1
Nee!le## $o +%!er#core $ha$ $he !"ffere%ce (e$'ee% a h"ghl #+cce##f+l
orga%".a$"o% a%! $ho#e lagg"%g (eh"%! "# !+e $o ho' eff"c"e%$l a%! effec$"-el
$he h+ma% re#o+rce# are &la%%e!, !e-elo&e! , re$a"%e! '"$h 6+#$ #alar
&ac)age#, "%ce%$"-e# a%! #er-"ce co%!"$"o%# a%! +$"l".e!1
+tephen 3ichards Covey (%ctober "8, 19D" 4 @uly 1, "01")
an (merican educator, author, businessman, and keynote speaker saidI
?B5- *!(&- $)5 3#/, -) -(,#- $)5( )6" 8,)8', -3, 6#$ $)5 6#"- -3,0 -) -(,#-
$)5( 1,&- +5&-)0,(&@
# append below thought provoking model of human resource development formulated
by Aineet <ayar, C*% of ?CL Technologies, a global #T 4 services firm, published
his book H*mployees 1irst, Customers +econdI which had yielded better results,
turning Conventional 0anagement 7pside Down, L9ha$ o+r e8&er"e%ce a$ 2erc)
E$!1, Tha"la%! ha! #ho'% +# 'a#D If 'e $a)e goo! care of o+r em&loee#, $he
'"ll $a)e goo! care of o+r c+#$omer#1 Ha&& c+#$omer# '"ll (+ aga"% a%! aga"%
'h"ch '"ll ge%era$e &rof"$# for o+r #harehol!er#1 A%! ha&& #harehol!er# '"ll
re$+r% &rof"$# $o $he #oc"e$1 E")e $h"#, e-ero%e ca% (e a '"%%er1M
E%!# of 6+#$"ce !ema%!# $ha$ lear%e! &eo&le "% F"%a%ce m"%"#$r a%! I3A
'"ll $a)e "m&or$ $he#e #o+%! log"c a%! co%#"!er o+r #acro#a%c$ !ema%! of 25%
h")e o(6ec$"-el , $o a+gme%$ #$aff mo$"-a$"o%# $o h"gher le-el# , "% f+lf"llme%$ of
$he am("$"o+# , &ragma$"c $arge$# #e$ ( o+r Pr"me 2"%"#$er a%! h"# go-er%me%$
"% re#&ec$ f"%a%c"al "%cl+#"o%# a%! gro'$h of &+(l"c #ec$or (a%)# "% f+ll gear#1
D9
CHAPTER 6 III
JUSTIFICATION IIID OUR DE2AND IS A JUSTIFIA3EE DE2AND
Let us compare the chart of the price of 18 commodities, which go into the
computation of minimum wage$ ,laced here under is the computation of the
0inimum wage on the basis of the prices of the re&uisite articles as in @anuary, "01D$
#t could be seen that 'h"le $he &r"ce# o% a% a-erage reg"#$ere! a% "%crea#e of
2=:12<1% $he DA com&e%#a$"o% ha! o%l (ee% F<150%
>For No-;Dec;Ja% 20/2;/:, AICPI =HFF, #la(# 5/0 a%! % F<15?
If 'e $a)e $he *+ar$er J+l 20/0;Se&$20/2, "$ 'a# <:% "% Fe(r+ar 20/2?1
This fact may kindly be used to bring home the necessity of revision of wages and
arriving at minimum basic wage immediately 3ates and ,resent 3ates Common
#tems 7sed on Daily 5asis$
Com&ara$"-e Char$D
+,<o #tem ,er
3ates as on
1$1$"00Q
in 3s
3ates as
per C,# as
on 1!1!
"01D in 3s
3ates as per market
rates in a
government
departmental store in
3s as on1!1!"01D
/ change compared
to 1!1!"00 prices
1 3ice >g 1M " .. "
"
Dal (Toor P
urd)
>g 80 .9 M. 18.
D 3aw Aeg >g 10 1. .0 .00
8
=reenleaf
Aeg
>g 10 18 ". ".0
. %ther Aeg >g 10 1J 80 800
1ruits >g D0 ". M0 "
J 0ilk lt "8 " D8 1".
M
+ugar and
'aggery
>g "8 D8 80 1
9 *dible %il >g .0 9 100 "00
10 1ish >g 1"0 1.J D"0 "
11 0eat >g 1"0 ".J D"0 "
+,<o #tem ,er 3ates as on 3ates as 3ates as per market / change compared
80
1$1$"00Q
in 3s
per C,# as
on 1!1!
"01D in 3s
rates in a
government
departmental store in
3s as on1!1!"01D
to 1!1!"00 prices
1" *gg each each " 8 . ".0
1D
Detergents
etc
>g "00 "80 D.0 1J.
18 Clothing 0t M0 1 1.0 1MJ
1.
Cokked
meals
D" J0 1MJ
Total /
increase D89P1.R"8D$"/
0arket 3ates as per local
market rates in metro
QRa$"o%ale of com&ar"#o% a# o% /;/;200<:
These are prices as mentioned in table "$"1 of
th
pay commission
S)5(+,7 -#1', 24241 .4C3 C3#8-,( 2 )* S!D-3 CC R,8)(-
2e note from above as against the increase of "8D$"/$ /, the bank employees were
granted D( ;J$.0// as on @anuary "01D
2"%"m+m 9age (a#e! o%S /5
$h
IEC Norm#
A# &er $he &re-a"l"%g ra$e# of commo!"$"e# a# o% 0/10<120/:
#tem ,er Day
,C7 ( in =rams)
,er month
D C7 ( in >g)
,rice per >g
(s on 01$01$"01D
Total cost per
month
3iceP2heat 8J. 8"$J. .. "D.1$".
Dal Toor P
7rad P 0oong
M0 J$" M. 1"
3aw Aeg 100 9$00 .0 8.0
=reen Leaf Aeg 1". 11$". ". "M1$".
%ther Aeg
%nion, potato,
tomato
J. $J. 80 "J0
1ruits 1"0 10$M M0 M8
0ilk "00 ml 1M Lt D8 1"
+ugarP@aggery . .$00 80 "00
*dible %il 80 D$ 100 D0
1ish "$. D"0 M00
81
0eat .$00 D"0 100$00
*gg 90 <os . 8.0$00
Detergents etc
5ath B washing
soap, washing
powder, etc
D.0
per month
D.0
Clothing
X
. mtrs per month$
Deduced from 0
mtrs per annum
3s1.0$ per meter J.0$00
Cooked food
meals like
0aggie and idli
flour, pi66a etc
during
expediency on
some days
10 days in month
Due to late sittings
etc$$
J0 "100
Total 1"0.0$.0
0isc$ ; "0/
Q
"810$10
Total 1880$0
(ddl$ *xp ;
"./
QQ
D1.$1.
Total 1M0J.$J.
?ousing 1.00
5ra%! To$al 20<5=125
,C7 R ,er Day Consumption 7nit

D C7 R Three Consumption 7nit

Q R "0/ miscellaneous charges towards fuels, electricity, water, etc

QQ R (dditional *xpenses ; "./ includes expenditure towards education,
medical, treatment, recreation, festivals, etc$ as per +upreme Court decision$

X Clothing as prescribed is J0 yards per year$ This will work out to . mtrs per month
and the cost include the ancillary charges like stitching etc
8"
He%ce $he m"%"m+m 'age $o (e !ema%!e! for 7 ("&ar$"$e #e$$leme%$# #ho+l! (e
R#120<5= $ha$ "# (a#"c &a a&&l"ca(le $o #+( #$aff em&loee#1
9herea# $he 3a#"c Pa 3a#e! o% ===0 merger a$ <01/5% of DA "# o%l R#17:<7
Ta)"%g $he rela$"-"$ form+lae of 7$h ("&ar$"$e a$ $he "%"$"al #$age (e$'ee% cler)
a%! #+( #$aff 'h"ch "#15H50DF200, $he m"%"m+m (a#"c &a for cler"cal #$aff 'or)#
o+$ $o R#11 25=0=4;
9herea# $he 3a#"c Pa 3a#e! o% ===0 merger a$ <01/5% of DA "# o%l R#1 //5:/1
#nfact a Clerk in Central =overnment +ervice (!" #$ B#"% 2) earns a monthly
salary of 3s$ ::,720, #+( #$aff /H,272 whereas the monthly salary of @0=+# officers
in bank is 3s$:2,/F/$ (5oth at the beginning of the scale)$ Compare this with the
salary of Ce%$ral 5o-er%me%$ Off"cer# (!" #$ B#"% 3S-#., I) which is 3s$
5=,FH0 >SeeD 6+#$"f"ca$"o% I, II of $h"# ar$"cle #er"e#? this is the mother of all
in'ustice$ (s stated above the rules of the game have now changed totally, with the
constitution of J C,C$ +o it will be imprudent to demand less than .0/ wage hike,
in order to settle for 8./ ultimately remember, even with 8./ increase in
establishment cost components ("$./ of pay slip components) we will be
marginally better off as compared to the C,C scales $ +o after 1!01!"01 Central
=overnment +taff will surpass us again and we will be left far behind$
So le$ +# (e (ol! a%! a#) for real"#$"c #alar #+"$"%g o+r "%$ell"ge%ce, 'or) loa!,
r"#), com&le$"-e #&r"$ demanding minimum"./ hike in pay slip components$
E-e% $ho+gh $he Se-e%$h Pa Comm"##"o% "# !+e from 0/10/120/< o%l, $he
5o-er%me%$ ha# a&&ro-e! com&o#"$"o% of Comm"##"o% 'ell (efore "$# !+e
!a$e to decide about the pay structure of Central =overnment employees which will
be revised after the report is submitted by the Jth Pa Comm"##"o% '"$h effec$ from
0/10/120/<1 >This in addition to the provision of .0/ merger of D( with 5asic ,ay
during the intervening period) The comparative scales since 19J9 are as under:!
Gear =roup!( %fficers of +cale!# %fficer in a
8D
=ovt$ of #ndia 5ank
,rior to 19J9 R#1=504; R#15004;
#n 19J9 R#1F004; R#1F004;
#n 19M
(8
th
pay commission from 19MJ)
R#12,2004;
R#1H,0004;
R#12,/004;
R#1F,/004;
#n 199
(.
th
pay commission from 199J)
R#1/2,5004; R#1/0,0004;
#n "00
(
th
pay commission)
R#1/5,<004; K 5P
R#15,=004;
To$al R#12/,0004;
Rs1/=,5004;

There is steep rise in the C,# inflation and the salaries in absolute terms have also
been eroded$ Consumer price index has already increased by 1.01 numbers over
8880 which was prevailing on 01P11P"01" i$e$ the level at which #5( has agreed to
merge the D( with basic pay$
Therefore m"%"m+m 25 % h")e a# !ema%!e! ( $he +%"o% "# a 6+#$"f"a(le a%!
rea#o%a(le !ema%! 'h"ch '"ll mee$ a%! e%!# of 6+#$"ce a%! m"%"m".e $he ga&
(e$'ee% $he 2"%"m+m 9age (a#e! o%S /5
$h
IEC Norm# a%! ac$+al (a#"c &a
#e*+el ===0 merger a$ <01/5% of DA a# me%$"o%e! a(o-e
NOTESD
I a!!+ce a%! a!+m(ra$e $he a(o-e log"cal, ra$"o%al, a&&ro-e! co%ce&$#
f+r$her a# +%!erD
T/? SRe#ol+$"o%/1F1/, /1F12 a!a&$e! "% /5
$h
Se##"o% of $he I%!"a% Ea(o+r
Co%fere%ce hel! a$ Ne' Delh" "% J+l /75F
Q/1F12 (t the 1.
th
+ession of the #ndian Labour Conference held at <ew Delhi in
@uly 19.J, an important resolution was passed, which laid down that the minimum
wage should be need!based and should ensure the minimum human needs of the
industrial worker$ The following norms were accepted as a guide for all wage! fixing
authorities including 0inimum 2age Committees, 2age 5oards, (d'udicators, etc$:
#$ #n calculating the minimum wage, the standard working class family
should be taken to comprise $hree co%#+m&$"o% +%"$# for one earner, the
earnings of women, children and adolescents being disregarded$
88
##$ 0inimum food re&uirements should be calculated on the basis of a net in
take of 2F00 calor"e#, as recommended by Dr1 A)ro! for an average
#ndian adult of moderate activity$
###$ Clothing re&uirements should be estimated on the basis of a per capita
consumption of 1M yards per annum, which would give for the average
workers family of four a total of J" yards$
#A$ #n respect of housing, the norm should be the minimum rent charged by
=overnment in any area for houses provided under the +ubsidised
#ndustrial ?ousing +cheme for low income groups O and
A$ 1uel, lighting and other miscellaneous items of expenditure should
constitute "0 per cent of the total minimum wage$ The 3esolution further
laid down that wherever the minimum wage fixed was below the norms
recommended above, it would be incumbent on the authorities concerned
to 'ustify the circumstances which prevented them from adherence to the
aforesaid norms$ The 3esolution, thus, tried to give concreteness to the
whole concept of minimum wage$
SSI% /77/, $he S+&reme Co+r$ "% "$# 6+!gme%$ e8&re##e! $he -"e' $ha$
ch"l!re%C# e!+ca$"o%, me!"cal re*+"reme%$, m"%"m+m recrea$"o%, "%cl+!"%g
fe#$"-al# ceremo%"e#, &ro-"#"o% for ol! age a%! marr"age #ho+l! f+r$her
co%#$"$+$e 25 &er ce%$ a%! (e +#e! a# a g+"!e for f"8"%g $he m"%"m+m 'age1
"$ F"f$ee%$h Se##"o%, >/75F? The Th"r$"e$h Se##"o% >/772? The I%!"a% Ea(o+r
Co%fere%ce o%ce ga"% ra$"f"e! $he a(o-e re#ol+$"o%#1
D$ The theory of D consumptions units of single bread winner as prescribed by
experts of the 1air 2ages Committee 198J after the industrial truce resolution
of 198J which is basis for wage structure in #ndia and #ndian labor conference
19." mentioned above is valid even today$ ( released Census "011 data
shows that (n overwhelming .1 per cent of urban households live on the
income of a single earner, while double!income families are a distant " per
cent$ #n rural areas, the situation is &uite different$ 2hile D8 per cent of
families have a single worker, double!worker families are slightly more at D.
per cent$ #n fact, the double!income!no!kids (D#<>) lifestyle celebrated as a
cosmopolitan aspiration is prevalent in nearly 8" per cent of two!member rural
8.
families compared to 'ust "" per cent of similar urban families$ 0ost of the
bank employees belong the single income bracket of sole bread winner with
minimum 8 dependents$
a) #n 1980 Central =ovt$ appointed on *n&uiry committee consisting of 5< 3aw,
+hri$ +hafat (hmad >han and 0r$ ?umes #C+ to report on the grant of war
D( to employees in =#, 3ailways$
H2hat has been the rise in the cost of living for the lower paid worker since
the outbreak of warY Committee came to a conclusion that #ndustrial worker
needs D c$u
b) S+(rama%"a%C# Re&or$ f"%!"%g# /72= &re#cr"(e! $ha$ 2"!!le cla##
'or)er re*+"re# :1< c1+ a$ #$ar$, 51< c1+ e"gh$ ear# of #er-"ce, Af$er
allo'"%g a !e!+c$"o% of H +%"$# for '"fe a%! 01< +%"$ for each of $'o
ch"l!re%
c) Thereafter$ @ustice 3a'adhakshya postedPtelegraph award 198. came to
the conclusion after family budget en&uiry, and thorough investigation
and study that Cost of living of 0iddle class R M0/ cost of living
#ndustrial worker$ This 1$M coefficient became the bench mark us to
determine the remuneration payable to members of +ub staff in @ustice
+en$ award of 19.1, +astry (ward 19.D and Desai (ward of 19"$
d) DeshpandeEs 3eport submitted (a#e! o% $he re&re#e%$a$"o% #+(m"$$e!
( em&loer# to government thereafter reduced the 0inimum
re&uirements of a new entrant to "$". c$u$
e) 5ut the +en tribunal without intending to lay down rule or formulate a
definite principles, the +en Tribunal believed that it was not like to be
much mistaken if the re&uirement of an employee in the 1
st
year of
+ervice were taken to "$". c$u$ The +en tribunal also considered that in
the M
th
year of his service on employee has to maintain D c$u$ and that
towards and of his service he would have to maintain 8 c$u$
f) The +astry Tribunal held the following views
1$ ,roper method was to provide for an employee and his wife at the
initial start and then provide for reasonable increments for the
growing needs of himself and his family including children that are
likely to be born$
8
"$ Calculating in according with the to Lusk coefficient it came to
conclusion: 1
st
year 1$M c$u$, 10
th
year D$c$u$ towards the end D c$u$
D$ #t changed M yrs to 10 yrs$
8$ #t stated that since &uite an appreciable number of workmen
remained unmarried in the age group of ".!D0 and suggested to take
10
th
year as the proper stage in which D c$u$ should be allowed$
<? The +%"o%# 'a%$e! $he co%#+m&$"o% +%"$# a# &er S+(rama%"a% Re&or$1
F? Ee#$ $h"# ar$"cle !oe# %o$ (ecome re#earch &a&er ( "$#elf o%
!e$erm"%a$"o% of co%#+m&$"o% of #ole (rea!'"%%er alo%e f+!g"%g $he foc+# of
$he ma"% ar$"cle '"$ho+$ hara%g+"%g f+r$her o% $h"# co%ce&$ I g"-e (elo' $he
#+mmar of f"%!"%g# of Se%, Sa#$r A%! De#a" Tr"(+%al '"$h regar! $o
co%#+m&$"o% +%"$#
+en +astry L(T Desai
1
st
Gear "$". 1$M "$". "$".
M
th
Gear D D D D
*nd scale 8 8 8 8
The Se% a'ar!;/7=7 f"8e! $he #&a% of 25 ear# , Sa#$r" a'ar!>/75:? 25 ear# ,
EAT >/75=? 25 ear# , 3a%) A'ar!# Comm"##"o% >/755? 25 ear# a%! De#a"
a'ar! mo!"f"e! "$ $o 20 ear# a%! $h+# $he !ema%! of +%"o% for f"8"%g #&a%
of 20 ear# 'h"ch #$"ll "% -og+e #"%ce Se% a'ar! 'a# f"%all f+lf"lle!1
These sacrosanct awards governing the bank employees even in vogue today
concluded that La o+%g ma% of I%!"a #$ar$"%g h"# career# a# a cler) ha# $o
#ho+l!er $he o(l"ga$"o%# "m&o#e! o% $he #oc"al #$r+c$+re of 'h"ch he "# a &ar$1
I$ ma (e !ema%!# of Jo"%$ H"%!+ fam"l ##$em or o$her cla"m# of K"$h a%!
K"%1 I$ ma %o$ (e a '"fe or ch"l! a$ $he comme%ceme%$ of h"# em&lome%$,
(+$ "$ ca% (e a fa$her of mo$her or (o$h or a #"#$er or a o+%ger (ro$her a%!
$o "g%ore #+ch mem(er# of $he fam"l a# %o$ (e"%g 'or)ma%C# earl
re#&o%#"("l"$"e# o% $he co%$e8$ of o+r #oc"al a%! eco%om"c co%!"$"o%# are 6+#$
+%real"#$"c1
Let us see how L(T approached the problem$ H2e consider +astry Tribunal-s
approach to the sub'ect is very narrow$ 2e have to take a common sense view of
these matters$ ( young man having matriculated 'oins a bank as a Clerk mostly
because he is unable to afford a higher education$ #t is the economics necessity
8J
which forces him to work at early age$ The extent of necessity is a &uestion of fact
in each particular case but no investigation has been made in this field or to as to
this particular aspect$ 2ages are necessarily fixed in accordance with the normal
expectations of family even though a particular workmen will may never marry
and nor have any dependentI$
No$eD I$ "# (eca+#e of $h"# #o+%! log"c $ha$ (a%) em&loee# ge$ gra!e!
"%creme%$# comme%#+ra$e '"$h re#&o%#"("l"$"e# a%! o(l"ga$"o%# $o h"# fam"l
a%! !e&e%!e%$# "% accor!a%ce '"$h $he "%crea#e "% age 'he% com&are! '"$h
o$her "%!+#$r"e# 'ho ha-e f"8e! "%creme%$#1
All $he a(o-e "rref+$a(le fac$# me%$"o%e! a(o-e "# co-ere! "% $he REPORT
OF THE NATIONAE COUNCIE OF APPEIED ECONO2IC RESEARCH
NE9 DEEHI ON 9A5E STRUCTURE IN INDIAN 3ANKIN5
PU3EISHED 3G NONE OTHER THAN THE INDIAN 3ANKS
BASSOCIATION, 3O23AG ON /H
TH
APRIE /7<71 FOR9ARDED 3G THE
THEN DEPUTG CHAIR2AN F1K1F1NARI2AN1
8$ E-e% $he <
$h
&a comm"##"o% a!o&$e! a(o-e &r"%c"&le# 'h"le arr"-"%g a$
6+#$ co%cl+#"o%# a# (elo'1
HThe sixth pay Commission 3eport says that it has attempted an in!depth study into
working of the private sector and noted that the compensation structure in the private
sector is &uite different as compared to =overnment sector$ +ince the establishments
in private sector primarily work for commercial purposes the employeeKs cost is
compared to the business worth$ +uch comparison is not feasible in =overnment 'obs
obviously for the reason that the =overnment sector is primarily service oriented$
(lso the variation in range of salaries in private sector is &uite wide$
%n comparison with =overnment sector it noted that the salaries can be said to be
definitely better in private sector only in reference to 'obs which can be compared to
=roup ( services$ ?owever in that respect the prestige and challenge offered by the
=overnment 'obs is also &uite high and the =overnment 'obs also provide incentives
by way of compensatory allowances, housing and transport facilities etc$$$ The
biggest advantage offered by a =overnment 'ob is the 'ob security attached to it and
the assured retirement benefits$ Commission has attempted to make the retirement
benefits more attractive$ #t has thus attempted to harmoni6e the tangible and
intangible benefits offered by the two sectors for achieving some element of parity$
8M
1or tackling the demand of the =overnment employees for making the minimum
salary in the range of 3s$ 10000P! per month the Commission has followed a multi
pronged approach$ 1irstly it worked out the minimum monthly re&uirements for the
family of lowest paid employee #t has based its calculations keeping in view
recommendations of the 1.
th
#nternational Labour Conference$ The expenses when
calculated on a family si6e of three units which is the expected family si6e for a 'ob
entrant came out in range of 3s$..00P!per month$
Thereafter the pay scales were fine tuned to make the minimum salary in the range of
3s$ 00P! in order to make the same approximate to the minimum needs of the
lowest paid employees$ Commission feels that the addition of ?3( and other
allowances would make it some where in range of 3s$10000P! as was demanded$
?owever simultaneously it also had to ensure that the relief is not considered as a
windfall gain for the employees$ #t has therefore suggested transformation of the
lowest paid employees into multiskilled workers whose skill levels could 'ustify the
higher wages$ The Commission has therefore recommended that the =roup D
employees be converted to =roup C employees in those cases where they fulfill the
&ualifications prescribed for =roup C posts$
This would ensure that they not only get higher wages but also handle higher
responsibilities$ The employees who do not possess the minimum &ualifications
should be trained for skill up gradation and subse&uent transition to =roup C posts$
3ecruitment to =roup C posts is proposed to be stopped forthwithI
?ence my calculation of minimum basic pays of 3s 25=0= clerical staff and
R#120<5=$ 1or substaff is per principles adopted by the the pay commissions, which
was basis in +en , +astri, Desai awards too as explained in J+#$"f"ca$"o% I of $h"#
ar$"cle #er"e# 1
32 Comparing price rise in last D0 yrs are so we can observe in last six years the
price rise graph has risen dramatically, i$e$ the prices have increased to a
maximum beyond common mans reach, the rupee value has gone down
drastically , internationally the dollar rate is higher, =D, is very low 'ust
around /$ The purchasing power has gone down$ The value of our salary six
years back and now if we make a simple compare, our salary is nothing
compared to private market
89
K2 There are nearly "." items in the consumer basket for determination of
consumer price index, in real terms the essential items for determination of
C,# should have been only ." items as per need based wages, by keeping a
vast items in the basket the actual price rise is not reflected$
L2 The 0iscellaneous articles weight age accounts for "./$ the food articles
accounts for .M/ weight age$ *ven if the rise in food articles is there, the cost
of TA, Computer, and 0obile etc where there is reduction is taking place, thus
depriving of the actual increase in C,#$ %verall the Consumer ,rice #ndex for
the 5ank P =ovt$ *mployees is not satisfactory, this has deprived us of the
actual D( B wages
42 The actual cost of the goods at villages and the cities are differently different
The cost of one kg of tomato will cost around 3s 1. in a village after it
brought to a retails shop in a city it is sold at 3s 80P! per kg$ The weight age of
'ust "0/ is not correct it should be 80/$
<2 The whole system of the (ll #ndia Consumer ,rice #ndex <umber for
#ndustrial 2orkers (C,#!#2) on base "001R100 B D( formula for the
=overnment employees is wrong and needs a relook
852 as in case of petrol prices as and when the international crude is
increasing the oil companies raise their prices of petrol, so no burden on them,
same should be the case of bank employees a# a%! 'he% $he AICPI
"%crea#e $he% $he DA #ho+l! a+$oma$"call "%crea#e e-er mo%$h a%! %o$
a-erage of *+ar$er a%! $he 3a#"c Pa #ho+l! (e #+"$a(l "%crea#e! '"$h
a&&ro&r"a$e merger Jloa!"%g $o $a)e care
882 #n view of the existing system of &uarterly average being accepted between
the parties to the negotiations rectify the same as pointed by a reader
Com&e%#a$"o% for "%crea#e "% AICPI "% $he form of D1A1 m+#$ (e %o$ le##
$ha% 01/5% each #la( of = &o"%$# "% $he /7<0U/00 #er"e#1 I$ '"ll (e #+"c"!al
$o agree for 01/0% a%! "f $here "# a% &#cholog"cal (arr"er $o acce&$
01/5%, $he% 01/=% "%crea#e for each #la( ma (e "%#"#$e! +&o% a%!
ach"e-e!1
.0
872 <ow finally let us answer the &uestion of government paying capacity$
%ne can find cogent article and through analysis, contributed by ebullient bank
employee uploaded by to (ll 5anking +olution $com$ giving ,(*)(0#"+,
3!.3'!.3-& )* &8,+!*!+ 8#(#0,-,(& )* 51'!+ S,+-)( B#"2& !" F4Y42012-13
+ee: source
http:PPwww$allbankingsolutions$comP2age!3evisionPZth!5ipartite!
+ettlementP2age!cost!vs!profit$htm
This thoughtful article reveals the following inalienable truth
S$aff Co#$ a# com&are! $o To$al I%come "# o%l /01=H% "% all P+(l"c Sec$or
3a%)#
Pro-"#"o%# J Co%$"%ge%c"e# are h"gher $ha% $he S$aff Co#$ "% all P+(l"c
Sec$or 3a%)#1
Pro-"#"o%# J Co%$"%ge%c"e# co%#$"$+$e //1<<% of $he To$al I%come "%
P+(l"c Sec$or 3a%)#1
,rovisions have a direct bearing on <et ,rofit and also the leverage for giving
higher compensation to the bank staff$
*xcept the provisions made for terminal benefits (and wage arrears, if any)$
5ank staffs are in no way responsible for keeping higher provisions$
E-e% "f a!!"$"o%al 2% of To$al I%come "# #&are! for h")e "% S$aff 3e%ef"$#
of P+(l"c Sec$or 3a%)#, "$ '"ll amo+%$ $o R#1/2, 2::1/< Crore#1
/:? O"'$ )5( %,0#"% )* 2C E 3!2, +#" +)08,"&#-, -) &)0, ,D-,"- -3, ,()&!)" !"
(,#' 6#.,& %5, -) !"*'#-!)" #& ,D8'#!",% 1,')6
#nflation in simple terms is the rise in prices of various goods over a period of time$
?owever, if everyone-s income went up by the amount of the prices, then no problem
would arise except that in nominal terms things would seem more expensive$ The
difficulty arises when some people gain out of inflation$ Typically in inflation, the
prices rise faster than the wages do$ #n other words, those who have property income
like profits and rent, gain more than the others$ (ctually, the properties gain at the
.1
expense of the wage and salary earners$ Through indexation of wages to prices, the
workers try to protect themselves$ ?owever, this is usually not enough$ 1urther, as
soon as inflation levels reach into double digits, there is pressure to break this link$
1inally, in #ndia 90/ of the work force is in the unorgani6ed sectors and is unable to
protect its income from the ravages of inflation$
5asically inflation is caused due to two broad reasons:
The Kcost push- given to the prices of key inputs like petrol, coal, steel etc$ 5y the
government which translates into an escalation of prices all around, and
increase in the supply of currency circulating in the economy resulting in Ktoo much
money chasing too few goods-$ 1or example, the money supply in the economy is
increased whenever the government faces a shortage of funds to balance its
expenditure$ The impetus for this comes either because some import prices have
risen (like, petroleum goods) or margins of trade and industry have risen or there is a
bottleneck in supply leading to increased margins (like, drought or floods or
speculation)$
( close examination of the economy reveals a number of additional culprits:
The indiscriminate increases in indirect taxes affecting prices of essential
commodities, and the entry of vast amounts of black money in the trade of various
goods and increased speculation in real estate$
E-e% $he Co%#+mer Pr"ce I%!e8 ma %o$ reflec$ $he real ra$e of "%fla$"o%, a#
e8&er"e%ce! ( commo% &eo&le, for #e-eral rea#o%#1 F"r#$, $he (a#)e$ of
commo!"$"e# $ha$ "# cho#e% for $he &+r&o#e of mea#+r"%g &r"ce r"#e ma %o$
reflec$ ac$+al co%#+m&$"o% &a$$er%# I e"$her $he commo!"$"e# ma (e !"ffere%$,
or $he 'e"gh$age g"-e% $o each commo!"$ ma (e !"ffere%$1 Seco%!l, $he
re&or$"%g of &r"ce# from -ar"o+# ce%$er# ma (e +%!er#$a$e!1
A $h"r! rea#o% "# o%e $ha$ "# &ar$"c+larl rele-a%$ %o', 'he% $here "# ra&"! &r"ce
r"#e "% e##e%$"al commo!"$"e#D D+r"%g #+ch a &er"o!, !e#&"$e $he h"gher &r"ce#,
&eo&le ca%%o$ grea$l re!+ce $he"r co%#+m&$"o% of #+ch commo!"$"e# >$he $erm
+#e! "# $ha$ L!ema%! "# "%ela#$"c "% rela$"o% $o &r"ce cha%ge#M?O co%#e*+e%$l, "%
$he"r $o$al (a#)e$ of co%#+m&$"o%, commo% &eo&le c+$ (ac) more o% o$her
commo!"$"e#1 I% $ha$ ca#e, e-e% "f $he co%#+m&$"o% (a#)e$ for CPI 'ere "%"$"all
correc$, "$ 'o+l! ge$ ra&"!l o+$!a$e! !+r"%g #+ch a &er"o!1 Ee$ +# a##+me $ha$
."
foo! "$em# ha-e a 'e"gh$ of <0 o+$ of /00 "% a co%#+mer &r"ce "%!e8O 'he% &r"ce#
of foo! r"#e ra&"!l, foo! "$em# m"gh$ ac$+all co%#+me F0 &er ce%$ of $he
e8&e%!"$+re of $ha$ #ec$"o% of co%#+mer#1 (+$ $he "%fla$"o% ra$e 'o+l! #$"ll (e
calc+la$e! a# "f $he o%l ma!e +& <0 &er ce%$, a%! he%ce $he off"c"al ra$e 'o+l!
+%!er#$a$e $he real co%#+mer &r"ce "%fla$"o%1 Th"# "# o%e rea#o% 'h &eo&le feel
$he off"c"al ra$e# ha-e l"$$le $o !o '"$h $he real ra$e $he e8&er"e%ce, a%! $he
"m&ac$ of "$ o% $he"r l"-e#1 >A%o$her rea#o% "#, of co+r#e, $he fac$ $ha$ mo#$
commo% &eo&le are alrea! ha-"%g !"ff"c+l$ ma)"%g e%!# mee$1 I% #+ch
c"rc+m#$a%ce# e-e% a Bmo!era$eC &r"ce r"#e ca% &+#h $hem o-er $he e!ge "%$o !"re
&o-er$1?
+ource: know globali6ation beyond 'argon published me for my union on "8!J!"008
2ith this understanding let us grimace and gloss through #nflation by country P
region
! The inflation tables below features and overview of the inflation by country
in "00 B "01D: The inflation rate is based upon the consumer price index
(C,#)$
CPI inflation 2006 by country / region
current inflation P country
annual inflation (dec vs$
dec)
average inflation
C,# inflation (ustria "00 1$89 / 1$88 /
C,# inflation 5elgium "00 1$8 / 1$J9 /
C,# inflation 5ra6il "00 D$18 / 8$"0 /
C,# inflation Canada "00 1$J / "$01 /
C,# inflation Chile "00 "$.J / D$80 /
C,# inflation China "00 "$M1 / 1$. /
C,# inflation C6ech 3epublic
"00
1$JM / "$.. /
C,# inflation Denmark "00 1$M1 / 1$M9 /
C,# inflation *stonia "00 .$18 / 8$88 /
C,# inflation 1inland "00 "$"0 / 1$.J /
C,# inflation 1rance "00 1$.D / 1$M /
C,# inflation =ermany "00 1$D9 / 1$.M /
C,# inflation =reat 5ritain "00 "$9J / "$DD /
.D
C,# inflation =reece "00 "$91 / D$"0 /
C,# inflation ?ungary "00 $.0 / D$9" /
C,# inflation #celand "00 J$0D / $M /
CPI "%fla$"o% I%!"a 200< <15: % 51F7 %
C$I inflation Indonesia 755K K#K5 = 8>#>9 =
C,# inflation #reland "00 8$9D / D$98 /
C,# inflation #srael "00 !0$10 / "$1" /
C,# inflation #taly "00 1$MJ / "$09 /
C,# inflation @apan "00 0$D0 / 0$"8 /
C,# inflation Luxembourg "00 "$D8 / "$J /
C,# inflation 0exico "00 8$0. / D$D /
C,# inflation <orway "00 "$"8 / "$DD /
C,# inflation ,oland "00 1$80 / 1$D1 /
C,# inflation ,ortugal "00 "$.1 / D$11 /
C,# inflation 3ussia "00 9$0" / 9$9 /
C,# inflation +lovakia "00 8$1J / 8$8M /
C,# inflation +lovenia "00 "$JJ / "$8 /
C,# inflation +outh (frica "00 8$M" / D$"8 /
C,# inflation +outh >orea "00 "$09 / "$"8 /
C,# inflation +pain "00 "$J / D$." /
C,# inflation +weden "00 1$8 / 1$D /
C,# inflation +wit6erland "00 0$" / 1$0 /
C,# inflation The <etherlands
"00
1$00 / 1$1J /
C,# inflation Turkey "00 9$. / 9$.9 /
C,# inflation 7nited +tates "00 "$.8 / D$"8 /
! +ee more at: http:PPwww$inflation$euPinflation!ratesPcpi!inflation!
"00$aspx[sthash$eaAt#M(y$dpuf
CPI inflation 2013 by country / region
current inflation P country
annual inflation (dec vs$
dec)
average inflation
C,# inflation (ustria "01D 1$MJ / "$00 /
C,# inflation 5elgium "01D 0$9J / 1$11 /
C,# inflation 5ra6il "01D .$91 / $"1 /
.8
C,# inflation Canada "01D 1$"8 / 0$98 /
C,# inflation Chile "01D D$0" / 1$J9 /
C,# inflation China "01D "$.1 / "$.J /
C,# inflation C6ech 3epublic
"01D
1$80 / 1$8" /
C,# inflation Denmark "01D 0$JM / 0$JM /
C,# inflation *stonia "01D 1$80 / "$J9 /
C,# inflation 1inland "01D 1$1 / 1$8M /
C,# inflation 1rance "01D 0$9 / 0$M /
C,# inflation =ermany "01D 1$8D / 1$.1 /
C,# inflation =reat 5ritain "01D "$00 / "$. /
C,# inflation =reece "01D !1$J1 / !0$9" /
C,# inflation ?ungary "01D 0$DJ / 1$J8 /
C,# inflation #celand "01D 8$1 / D$MM /
CPI "%fla$"o% I%!"a 20/: 71/: % /0172 %
C$I inflation Indonesia 758> L#L7 = K#47 =
C,# inflation #reland "01D 0$"0 / 0$.0 /
C,# inflation #srael "01D 1$M8 / 1$.. /
C,# inflation #taly "01D 0$ / 1$"" /
C,# inflation @apan "01D 1$1 / 0$D /
C,# inflation Luxembourg "01D 1$.8 / 1$J8 /
C,# inflation 0exico "01D D$9J / D$M1 /
C,# inflation <orway "01D "$08 / "$1D /
C,# inflation ,oland "01D 0$JD / 0$99 /
C,# inflation ,ortugal "01D 0$"0 / 0$"J /
C,# inflation 3ussia "01D $8M / $JJ /
C,# inflation +lovakia "01D 0$8D / 1$80 /
C,# inflation +lovenia "01D 0$M / 1$JJ /
C,# inflation +outh (frica "01D .$D0 / .$JJ /
C,# inflation +outh >orea "01D 1$18 / 1$"M /
C,# inflation +pain "01D 0$". / 1$8" /
C,# inflation +weden "01D 0$18 / !0$08 /
C,# inflation +wit6erland "01D 0$0J / !0$"" /
C,# inflation The <etherlands
"01D
1$J0 / "$.D /
..
C,# inflation Turkey "01D J$80 / J$89 /
C,# inflation 7nited +tates "01D 1$.0 / 1$8J /
:http:PPwww$inflation$euPinflation!ratesPcpi!inflation!
"01D$aspx[sthash$=lo(0@r&$dpuf
The a-erage "%fla$"o% of I%!"a "% 200<D 51F7 % ro#e $o /0172 % "% 20/: >SeeD
So+rceD I%!"a, 2"%"#$r of F"%a%ce, 2o%$hl Eco%om"c Re&or$, Decem(er 20/2?
a%! $he "%fla$"o% I%!"a "# $he h"ghe#$ as a(o-e $a(le re-eal#1
/=? Procra#$"%a$"o% I# $he C+l$+re of The 3a%)er#
9"$h $he go-er%me%$4# fa"l"%g m"#era(l $o c+r( "%fla$"o% +%!er$a)"%g co%$rol
of "%fla$"o% reform# ,!e#&"$e &ool &rom"#e# a%! &ol"c &ro%o+%ceme%$ 'h"le "%
&o'er $here "# #$ro%g ca#e ma!e ( +# $o $he 5O@ERN2ENT 4I3A
co%#"!er"%g o+r 6+#$ !ema%! of 25 % "%crea#e ,more #o 'he% 'age# "% o$her
co+%$r"e# "% $he $a(le "# for a(o-e $he 'age# &a"! "% I%!"a , !e#&"$e $he"r le##er
"%fla$"o% ra$e# , e#&ec"all 'he% $he glo(al".a$"o% , EP5 rhe$or"c are (+.. 'or!#
a%! ma%$ra# of $he #+cce##"-e 5o-er%me%$ "% &o'er #"%ce /77/, "% re#&ec$ a%
fac$or# ,"%cl+!"%g !e%a$"o%al".a$"o% , merger# J ac*+"#"$"o%# , I%!"a% (a%)# $o
ach"e-e glo(al #$a%!ar!# e$c ,(lah, (lah O(lah 11 e$c, e$c11 11 V1 "% I%!"a%
eco%om1
2 ar$"cle !ema%!"%g 5 !a char$er '"$h "$# e8ha+#$"-e memora%!+m $o
go-er%me%$ of /:: &age# '"$h "$# 'ell re#earche! 6+#$"f"ca$"o%#, "% $+%e '"$h $he
glo(al $re%!# "% -og+e 'h"ch 'a# co-ere! "% :H #oc"al %e$'or)"%g #"$e# a%!
recog%".e! a%! a&&rec"a$e! "% me!"a ' a# re6ec$e! ( $he go-er%me%$ 4 I3A
+ee:
http:PPwww$allbankingsolutions$comP2age!3evisionP.!days!weekP.!days!week!
<75*!detailed!note$pdf
http:PPbankingonly$comP.!day!week!demanded!by!national!union!of!bank!
employees!with!1DD!pages!'ustificationsU89M.$html
http:PPimportantbankingnews"$blogspot$inP"018P0JPletter!to!fm!for!.!days!week$html
A%o$her ar$"cle of m"%e "% !ema%!"%g "%crea#e "% re$"reme%$ age for 'ell '"$h "$#
o%ce ga"% 'ell re#earche! memora%!+m '"$h"% 2= ho+r# af$er $he %e'# &a&er#
&+(l"#he! re&or$ $ha$ $he go-er%me%$ "# &la%%"%g $o "%crea#e $he re$"reme%$ age
for 'hole $"me !"rec$or#, "% co%#o%a%ce '"$h glo(al $re%!# "% force 'h"ch 'a#
.
o%ce aga"% co-ere! "% :7 #oc"al %e$'or)"%g #"$e# a%! me!"a is also not considered
by the #5(P =overnment combine $"ll !a$e$
+ee
http:PPwww$allbankingsolutions$comP2age!3evisionP3etirement!(geP3etirement!
age!<75*!demand$htm
http:PPbankingonly$comPnewsP.!day!week!demanded!by!national!union!of!bank!
employees!with!1DD!pages!'ustificationsU89M.$html
http:PPimportantbankingnews$blogspot$inP"01"P1"Pnational!union!of!bank!employees!
nube$html
During 199, on account of +upreme Court @udgement in the matter of +teel
(uthority of #ndia As 7nion of #ndia, the appointment on compassionate ground was
not to be claimed as a matter of right, but management to offer it on the basis of the
Kpenury- and Kprecarious- living conditions of the family of the deceased employee$
The =overnment of #ndia, advised all ,ublic +ector 5anks to adhere to the spirit of
the +upreme Court @udgement on compassionate appointment$ They also laid down
penury norms for appointment on compassionate grounds$ ?owever, in case of death
while on duty, on account of dacoity, violence, robbery etc$, compassionate
appointment as well as cash compensation was made available$
+ubse&uently, based on the recommendations of the #5(, ,ayment of ex!gratia to the
dependent family members, instead of appointment was introduced during "00.$
%ne of the reasons for depriving the appointment was, the #5( 0anaging Committee
felt that, such appointments will dilute the efficiency of the 5ank$
(fter protracted struggles, strikes ever since this noble scheme, prevalent in
=overnment services was annulled only in banks since 199, 7157 submitted
scheme for compassionate appointments in ,ublic +ector 5anks at par with
government employees- scheme on 0D!08!"00M explaining and 'ustifying the
reintroduction with rationale and logic$
*ven this noble scheme was considered by the government after repeated
memorandums, delegations , struggles only after 1M years , only very recently
.J
during @uly "018$ This in &uintessence shows the culture of procrastination of the
#5(P 5ankers combine$
N,,%',& -) 5"%,(&+)(, 3,(, -3#- !" (,&8,+- #1)/, -3(,, %,0#"%&= !"-()%5+-!)" )* C
%#$ 6,,2 #- 8#( 6!-3 .)/,("0,"- ,08')$,,& = !"+(,#&!". (,-!(,0,"- #.,= #"%
!"-()%5+-!)" )* +)08#&&!)"#-, #88)!"-0,"- &+3,0, !" 1#"2& #- 8#( 6!-3 +,"-(#'
.)/,("0,"- &+3,0,&= %5(!". ",.)-!#-!)"&= #& -3, +!(+5'#(& -3, 5"!)" (,/,#'& IBA
3#& +)"&!&-,"-'$ #%#8-,% ,!-3,( ",5-(#' )( #.(,,% (6!-3)5- #&&5(#"+,&) *#/)5(#1',
(,+)00,"%#-!)" -) -3, G)/,("0,"-= 63!+3 6#& 2,8- !" +)'% &-)(#., 1$ -3,
G)/,("0,"- *)( 0#"$ $,#(&4 A& 0,"-!)",% #1)/, 1#((!". +)08#&&!)"#-,
#88)!"-0,"- &+3,0, =-3#- -)) #*-,( 18 $,#(& = ")", )* -3, &) +#'',% *#/)(#1',
(,+)00,"%#-!)" 1$ IBA !" (,&8,+- )-3,( -6) !08)(-#"- %,0#"%& 0,"-!)",%
#1)/,= 63!+3 %),& ")- +)&- #"$ ,D+3,F5,( -) -3, 1#"2&= 3#/, 1,," +)"&!%,(,% 1$
-3, G)/,("0,"- -!'' %#-,$
Tha$ (e"%g $he ca#e, log"call o+r !ema%! #ho+l! (e o% glo(al #$a%!ar!# a#
a&&l"ca(le $o (a%) em&loee# "% o+r co+%$r"e#1 1 S"%ce "$ m loo) +$o&"a%, or
am("$"o+#, !e#"ra(le (+$ %o$ &o##"(le 'e ha-e co%#$r"c$e! o+r !ema%! $o $ha$
$oo "% 6+#$ 25 % h")e "% &a #l"& com&o%e%$# ca%%o$ re6ec$e! o+$ r"gh$l ( I3A
'"$ho+$ !"alog+e a%! !"#c+##"o%, !"#regar!"%g h"#$or"c $ra!"$"o%# of ("la$er"#m
a%! ("&ar$"$e o% #&+r"o+# a%! 6e#$ gro+%!#1 I# $h"# %o$ !o+(le $al) or &e!!l"%g
"% #o&h"#$rW A$ 'ho#e "%#$a%ceW
/5? Eear% from h"#$orD

1riends,
2e learn from history as well as fail to learn from history sometimes history repeats
itself$ The reality underlying the edifice and life of tradition movement in #ndia is that
nothing is ever settled and methodical in labour matters in our country$ The little
achievements we have secured re&uired bitter struggles before each inch of progress
could be made$ Throughout this millennium of struggles runs one red thread of
continuity and synonimity 4 struggleEsuccessE struggle\
?istory records that when the year 198J witnessed industrial unrest in the country on
an almost unprecedented scale and the number of man days lost during the year was
1$ million, the highest recorded since 19D9$ ,roduction had also fallen all round
and the engineering and manufacturing concerns$ %f Kproduce or perish was raised$
.M
#n Dec$ 198J$ the =ovt$ of #ndia called a tripartite conference of representatives of
the control and state =ovts$ *mployees, employers in order to consider what action
should be taken to remedy the situation$
The conference unanimously adopted what has since come to be known #ndustrial
Truce resolution$ The ob'ect of that resolution was to recommend measures to arrest
the rapid$ Deterioration in relations between employers and labour and to ensure
conditions that would encourage production, which was so vital to the economy of
the country, could not be achieved without the fullest corporation between labour and
management$
#n consonance with #T3, the 1air wages committee and profit sharing bonus
committee, which were tripartite in character, were constituted by the central govt$
The report of this committee forms an important land mark in the evolution of the
wage level and the wage structure in #ndian industry$ #ts main task was to define the
Kfair wage- in #ndustry, but in its terms of reference it was asked to state in addition
what was understand by:
a) 0inimum wage
b) 1air wage
c) Living wage
These concepts were explained by me with great details in @7+T#1CT#%< 1 of this
series
The experts committed were of the view that the level of national income at that time
doe not permits payment of living wage$ #n deciding the &uestion as to whether the
Living wage has been introduced by any employer the experts opined as per studies
revealI "$ %o$ (e %ece##ar $o e8am"%e $he 'age #$r+c$+re &a"! $o $he rele-a%$
'or)"%g cla## a# a 'hole 1I$ "# 'ell e#$a(l"#he! $ha$ $he cla"m for (o%+# "#
recog%".e! o% $he (a#"# of $he co%$r"(+$"o% ma!e ( $he 'or)"%g a# a 'hole $o
$he &rof"$# of $he em&loer a%! 'e $h"%) of '"ll (e "%-"!"o+# a%! o% &r"%c"&le#
+%rea#o%a(le $o "#ola$e a fe' ca#e# 'here h"gher 'age# ma (e &a"! a%! $o cla"m
"mm+%"$ from $he &ame%$ of 3o%+# $
9"$h $o!a ame%!me%$ $o (o%+# ac$ (e"%g o+r lo%g &e%!"%g !ema%! e-er #"%ce
/7H<, %o%e of (a%) em&loee# "% #+(or!"%a$e a%! %o% #+(or!"%a$e ca!re com"%g
'"$h"% $he (o%+# ce"l"%g (rac)e$# a# a&&l"ca(le a# &er ac$# "% -og+e, &ame%$
of 3o%+# $o (a%) em&loee# for $he -al+e a!!e! ( $hem "% crea$"o% &rof"$# ha#
(ecome a !"#$a%$ !ream$
.9
Th+#D
L!/!". 6#., !& )5( %(,#0G
F#!( 6#., !& )5( .)#'G
M!"!050 6#., !& )5( 8()-,+-!)"G
#n view of fact the realistic calculations as above calculations are based on the sound
principles laid by experts committee set by =overnments such as fair wages
committee 198J, #ndian Labour Conference 3esolution etc which stand test time
even today before many wage boards, The in evitable conclusion which leads
therefore as a corollary "# o+r !ema%! of 25 % h")e "% &a #l"& com&o%e%$# "# fa"r,
6+#$ mee$# e%!# of 6+#$"ce of #ec+r"%g J+#$ a%! fa"r 'age a%! #ho+l! (e #e".e!
form +%"el!"%g ha%!# %o hol!# (arre!
P1S Rea! m ar$"cle $"$le! L9ha$ Co%#$"$+$e# a Rea#o%a(le a%! J+#$"f"a(le H")e
"% 3a#"c Pa "% $he /0$h 3PSWM 'r"$$e% a ear ago e-e% (efore $he
comme%ceme%$ of /0 ("&ar$"$e 'age %ego$"a$"o%# "% co%6+%c$"o% '"$h $h"#
ar$"cle5
+ee: http:PPwww$allbankingsolutions$comP2age!3evisionPZth!5ipartite!
+ettlementP2hat!is!reasonable!hike$htm
0
CHAPTER 6 IV
J+#$"f"ca$"o% I@D O+r Dema%! "# comme%#+ra$e '"$h $he "%crea#e "% o+r
&ro!+c$"-"$ a%! eff"c"e%c
+ince the process of liberalisation and reform of the financial sector were set in
motion in 1991, banking has undergone significant changes$ The underlying
ob'ective has been to make the system more competitive, efficient and profitable$
2ith greater globalisation and expansion of financial services, risk management has
become critical and indispensable$ +ince 1991, there have been two ma'or stock
market scams ) those engineered by ?arshad 0ehta and >etan ,arekh$ These were
systemic crises that cast doubts about the efficacy of the banking system$ Low labour
productivity was cited as one of the important factor for this state of affair$
The standard measures of productivity, better known as accounting measures, involve
calculation of output per unit change in a single input assuming that other variable
factors, technology and institutions remain unchanged (average productivity)$
5usiness per employee, profit per employee, ratio of operating costs to average assets
or ratio of operating income to staff expenses are often used as traditional measures
of productivity in the banking sector
5anking, by nature is an information and human capital intensive industry,
notwithstanding the increased reliance on technology solutions for improving
productivity$ ?ence, labour cost plays an important role in determining the
1
profitability of banks$ Therefore, at a disaggregated level of operating costs, labour
cost (expenditure on salaries) per unit of earning assets assumes importance among
the components of operating costs$
#n manufacturing, value added or net output is taken for output measurement$ #n the
services sector, output is not tangibleO therefore, it is difficult to &uantify$
Different proxy indicators such as profit and volume of business per employee are
used to measure labour productivity, an important but not the sole factor influencing
profitability$ The real -ar"a(le, #+ch a# $he %+m(er of acco+%$# &er em&loee, "#
$he o$her "%!"ca$or of la(o+r &ro!+c$"-"$$ (gainst this backdrop, we try to analyse
the concept of productivity and profitability$ %utput of bank employees #ndia
measured in real and monetary terms$
Ta(le A
PERFOR2ANCE HI5HEI5HTS OF PU3EIC SECTOR 3ANKS
FOR THE PERIOD 200<;200F J 20//;20/2
200<;200F
>"% R#1Cr1?
20//;/2
>"% R#1Cr1?
I%crea#e
"% %
CA5R%
Deposits 1998"00 8DJ"9M. 119$"M "1$J/
#nvestments 8M. 1D"M.D8 99$M" 1M$9
(dvances 188018 DD0.D" 1"9$.D "D$1
Total 5usiness D8D8D8 JJM1J 1"D$.M
#nt$ income 181M. DD1M ""D$11 ""$"
#nt$ expended 10190 "D11.D 1"$J0 ""$J
<et int$ income """. 1D.1. 11J$"1 "1$8
5usiness per employee
(in 3s$Lakhs)
8J1$1M 101D$D 11.$1"
,rofit per employee (in
3s$Lakhs)
"$J .$9D 118$M.
+ource 3$5$#
#f we look at . years historical performance (i$e$ from the 9
th
bipartite settlement)
,ublic +ector 5anks as per above table
,ublic sector bank has grown its deposits, advances and business per employee
by the highest rate "1$J/, "D/ and "1$1/ respectively$
"
(s far as net interest income is concerned it has grown in ,ubic +ector 5anks
by "1$8/$
The total business has grown by 1"D$.M/
The growth in the business per employee and profit per employee has been the
highest for public sector banks, in absolute terms, and has almost doubled$ The
average business per employee of all ,+5s taken together increased from 3s$
8J$M8 in 199"!9D to 3s$ "1.$0 lac in "00"!0D to 3s$ /0/:1<: "1e1 2/155 $"me#
'he% com&are! '"$h /772;7:, =1F0 $"me# 'he% com&are! '"$h 2002;0:
a%! 21/< $"me# 'he% com&are! '"$h 200<;0F
S$aff #$re%g$h "% &+(l"c #ec$or (a%)#
Concurrent to his increase in volume of business in the banks as the figures in
the table reveals ,The staff strength of public sector banks which stood at
M,MD,8M in 199M!99 has reduced to J,.J,.D. as on "010!11 4 a drastic
reduction of 1,",111$
9here a# $he %+m(er of (ra%che# "% &+(l"c #ec$or (a%)# "%crea#e! from
=2:0/ $o <=<F:a% "%crea#e of 521HH% !+r"%g $he &er"o! /77H; 20// 1A# o%
:/;:;20/2 %+m(er PS3 (ra%che# "# <F,7:01The ear 20/: ;20/= '"$%e##e!
aggre##"-e a%! "%$e%#"f"e! (ra%ch e8&a%#"o%# '"$h re#&ec$"-e
ma%ageme%$# 1(a%) ma%ageme%$# o&e%e! h+%!re!# a%! $ho+#a%!# of
(ra%che# !+r"%g la#$ $'o ear# '"$ho+$ a!!"%g e*+"-ale%$ %+m(er of
em&loee# "% $he"r (a%)1
2hereas during the same period private sector banks staff strength increase
from 0,JJJ in 199M!99 to ",1M J9 an increase of 1,.J,90" underscoring a
vital point that ,ublic +ector 5anks are no longer the ma'or employment
provider in the financial market$
D
#t may be noticed from below given chart that total number of employees in public
sector banks has come down from M$MD lacs in the year 199M!99 to J$J1 lac in the
year "01"!1D$ #n a span of 1D years of reformation, number of branches has
increased at least two fold and the volume of business has gone up by at least ten
times$
Though per employee business of state run bank has increased compared to that in
private banks to labour exploitation policy adopted by these banks, the &uality of
assets is much better in private banks than in public sector banks$ Customers get
better service in private banks and investors give better value to shares of private
banks"
M)(,)/,( %5(!". &!D-!,& #"% &,/,"-!,&= 851'!+ &,+-)( 1#"2& 5&,% -) 3#/, )", )**!+,(
)/,( *!/, -) &!D +',(!+#' &-#**4 I- 0,#"& +',(2 -) )**!+,( (#-!) 5&,% -) 1, C7 1 )( B7 14
A& )* ")6 -3, &!-5#-!)" !& <5&- )88)&!-, -) !-4 N)6 !" 851'!+ &,+-)( 1#"2& (#-!) )*
+',(2 -) )**!+,( !& ")6 17 C )( 17 B
8
These 5anks may achieve the target of number of branches under 1inancial #nclusion
to please their mentor ministers but may not stop escalation in resultant risk
banks likely to face in future$ They may not stop rise in bad assets and rise in
&uick mortality of assets$ These banks may show little rise in profit by
manipulation, they may fraudulently show bad assets as good assets by using the
tools of restructuring bad assets , they may reduce provision on bad assets to
book more profit and so on$ 5ut no power on earth can save these banks from
going from bad to worse as long as these reduction of 'obs persists, inade&uate
manpower planning whims and fancies bereft of logic and science at the cost of
&uality of their assets and at the cost of 'oy and pleasure of human resources
working at grass root level by denying them competitive, comparable and
'ustifiable wage$
This other words means $here "# a% "%crea#e "% &re##+re of 'or) o%
&+(l"c #ec$or (a%) em&loee# , "%crea#e! 'or) loa! !+e re!+ce! #$aff
#$re%g$h and !"#&ro&or$"o%a$e "%crea#e "% (ra%che# , and as a result
additional of other auxiliary works instructed by =overnment like collection
tax, electric bills, telephone bills, other miscellaneous government department
work at state and central level from time to time such as disbursement of
pension to unorgani6ed , ro'gar yo'nas, <3*= schemes and etc in addition
to routine bank work$
The c+rre%$ #e%#e8 "%!e8 "# a$ a% all $"me h"gh (+$ <5% of I%!"a%
ho+#ehol!# !o %o$ ha-e (a%) acco+%$ >"% r+ral I%!"a $ha$ "# F0%
accor!"%g $o $he Ce%#+# of I%!"a ho+#ehol! #+r-e)$ #n this context we
appreciate and support the steps taken by the ?on$ ,rime 0inister with a view
to eradicate poverty, to get rid of Hfinancial untouchability,I in his
#ndependence Day speech to the nation launching the campaign ,radhan
0antri @an Dhan Go'ana stressing the importance of financial inclusion$ *ven
as ,rime 0inister launched the scheme in <ew Delhi, officials from various
banks simultaneously brought financial services to JJ,M." towns, villages and
remote hamlets across the country$ The ,rime 0inister has also asked that the
target of opening J$. crore bank accounts is to be completed by "th @anuary,
"01.1Re&or$# co%f"rm $ha$ almo#$ all $he (a%) ma%ageme%$# ha# !ec"!e!
$ha$ he%cefor$h, $he (a%) '"ll (e hol!"%g #+ch cam&# o% 'ee)l (a#"#,
from H am $o H &m o% all Sa$+r!a# #o $ha$ $he $arge$ of co-er"%g
+%(a%)e! ho+#ehol!# "# ach"e-e! 'ell "% $"me for $he #+cce## of $h"#
#cheme1
<eedless to underscore here even before launching this scheme bank
employees have been actively participating the C(+(, <% 13#LL+
(CC%7<T+, <,( 3ecovery campaigns$ The respective unions and officers
association in tandem have whole heartedly supported and will be supporting
.
in the days to come, the endeavor the bank management spiritedly all these
days, even campaigning on +undays, holidays and beyond the working hours
on week days expecting no incentives or monetary compensations to meet the
targets set in the &uarterly business plan in their respective banks$ #t is because
of the commitment shown by the bank employees that the business and
productivity parameters shown in the table above have increase in leaps$
Na$+rall #+ch (+#"%e## &romo$"o%# ha-e re#+l$e! "% h"gher 'or) loa! o%
$he #$aff1 "% &+r#+a%ce of #+cce## of #+ch cam&a"g%# em&loee# are
re*+"re! a%! fo+%! $o (e 'or)"%g (eo%! $he"r #$"&+la$e! 'or)"%g ho+r#
af$er com&le$"%g $he !a# ro+$"%e $ra%#ac$"o%# 'h"ch o% %ormal !a# , !+e
$o !e&le$e! ma% &o'er, e-e% e8$e%!# (eo%! 'or)"%g ho+r#1 Nee!le## $o
em&ha#".e here, (a%) em&loee# a%! $he"r +%"o%#4 off"cer a##oc"a$"o%#
+&hol! $he !oc$r"%e, B)5( 8().(,&& !& !"-,(-6!",% 6!-3 1#"2& 8().(,&& 1#"2&
8()&8,(!-$ !& )5( &,+5(!-$B, ha-e e8hor$e! a%! &ar$"c"&a$e! "% #+ch %o(le
e%!ea-or# 1 Th"# (e"%g a% "rref+$a(le fac$ Bh"gher -3, 6)(2 ')#% 3!.3,(
&3)5'% 1, 6#., Ba%! he%ce o+r !ema%! "% $h"# regar! "# 6+#$ a%! r"gh$1
1(+$ 'age a# a ra$"o $o $o$al e8&e%#e# ha# !o'%1
Compounding to above problem is the special efforts taken for educating
customers, more so illiterate customers to fill up account opening forms in
strict observance of >GC norms as per extant 35# guidelines$ The
co%#e*+e%$ $"me $a)e% ( a% em&loee $o e!+ca$e, crea$e a'are%e## a%!
)e !a$e "% $he KGC mo!+le e8erc"#"%g !+e !"l"ge%ce co%#+me# a$ a%
a-erage m"%"m+m of /0 m"%+$e# >&ro-"!e! $here "# %o l"%) fa"l+re#?$ This
naturally results in extended hours of work as one has to also attend to other
allotted routine work$ 2hen it comes mass C(+( campaigns , the task force
entrusted with the task with view of mobili6ing substantial counts in day gets
the forms filled up and keys the data after the campaign hours often sitting late
to some times even upto late nights, sacrificing their social time, leisure and
work 4life balance "f $he $arge$ #e$ +& $he &r"me m"%"#$er of o&e%"%g F15
crore (a%) acco+%$# "# $o (e com&le$e! ( 2<$h Ja%+ar, 20/5 "# (e me$
$ha% '"ll $ra%#la$e "%$o o&e%"%g 5F:FF0 acco+%$# &er !a re#+l$"%g "%
75<2H a!!"$"o%al ho+r#1
#f the ob'ective analysis of the time available per man per year has to
estimated on following assumptions
Days in a year
+aturdays in a year
+undays in a year
=a6etted ?olidays in a year (*xcluding +undays)

Casual Leaves
Days average leave availment by employee P year
Days +ick Leave
Days training and other purposes
Available woring ti!e "er !an year #$inute%& %'oul( be
calculate( a%
(vailable time P man P day R J hrs 4 0$. hrs (for lunch)
0onday to 1riday R $. hrs 4 D90 minutes
(vailable time of +aturday R 8 hrs R "80 minutes
(vailable time P man P year R V ]D. days 4 (." +undays T "" days
=a6etted ?oliday T 1" days Casual Leave T 1.days (verage *arn Leave T 10
days (verage +ick Leave T .days Training)^ Z D90 0inutes T ]." +aturdays
Z "80 minutes^W R M9D10 0an 4 0inutes P year
5ased on the above ade&uate manpower planning should be made by the bank
management providing necessary additional allowances for exigencies such as
availment of leave, retirement, resignations, promotions, death etc
9"$h co#$ c+$$"%g o%l o% la(o+r , !o'% #"."%g (e"%g $he or!er of $he !a , %ee!
(a#e! recr+"$me%$# a%! (+#"%e## m"8 co%#e*+e%$ $o $he a(o-e a!!"$"o%al $a#)#
(e"%g m"#ma$ch "% &rac$"ce , ah# &+$ e%ormo+# 'or) #$ra"% o% $he e8"#$"%g
em&loee#1
A!!e! $o $h"# a!!"$"o%al 'or) &re##+re "# $he 2e%ace of Co+%$erfe"$
C+rre%c a%! #or$"%g of #o"le! %o$e#1 The problem has ac&uired serious
proportions of late$ +etting aside the primitive printing methods criminals
involved, the racket of fake currency now use sophisticated gadgets to
manufacture fake #ndia currency notes which conform to almost all security
parameters$ ?ence differentiating between the fake and genuine ones is
rendered very much difficult$ 0ore so in the midst of our preoccupation with
our routine duties extending precautionary measures beyond a certain level is
rendered not possible$ The &uality of counterfeiting has scaled new heights
that only a close scrutiny and that too by an expert alone can detect the
discrepancy$ #n Chennai in one instance the police referred two wads of
3s$.00P! denomination to a <ationalised 5ank which was passed by them for
genuine$ ?owever further verification sought through the 3eserve 5ank of
#ndia proved that it was fake$ 7nder such a serious risk only we are
constrained to carry out our duty across the counter in the Currency Chests$ #t
is ascertained that the number of cases registered has been increasing year
after year$ The =ovt$ itself has conceded that through some District in
J
@harkhand and 2est 5engal +tate placed near the border with 5angladesh, the
fake currency is pumped into the country by ,akistan based (gencies$
A% R3I !a$a re&or$# $ha$ for ear 20/0;// $he co+%$erfe"$ %o$e# !e$ec$e! =:5<0F
&"ece#, a%! for 20//;/2 a# 52//55 &"ece# , o+$ of 'h"ch R# 500 !e%om"%a$"o% fa)e
%o$e# for $he rele-a%$ &er"o! 'ere 2,=<,0=7 a%! :,0/,<FH re#&ec$"-el 1
De%om"%a$"o%;'"#e Co+%$erfe"$ No$e# De$ec$e! ( $he 3a%)"%g S#$em ((pril!
0arch)
(<o$ of pieces)
#ear $2 $% $10 $20 $%0 $100 $%00 $1000 &otal
1 2 ' ! % ( 7 ) * 10
2010+11 + + 1'* 12( 10*(2 12!21* 2!(0!* %!112 !'%(07
2011+12 + + 12( 21( 12!%7 12''*) '01(7) )'2)0 %211%%
2012+1' 1 1 '21 221 *7%* 10)22% 2)12(% *)!%* !*)2%2
9e re&ro!+ce here'"$h $he rele-a%$ e8cer&$# from a la$e#$ R3I Re&or$ o% $h"# #+(6ec$
C+rre%c 2a%ageme%$
'h"ch "# #elf e8&l"c"$1
S)5(+,7 0eport of the Central 1oard of Cirectors on the wor!ing of the 0eserve 1an!
of India for the "ear ended )une >5, 758> submitted to the Central Government in
terms of ection 3>/72 of the 0eserve 1an! of India .ct, 8<>9,
!" VIII C5((,"+$
M#"#.,0,"-
H0anaging currency is one of the core functions of the 3eserve 5ank, being the
central bank of #ndia$ (lthough coins of all denominations are issued by the
government, they are put into circulation through the 3eserve 5ank$ The 3eserve
5ank is the sole authority for issuing banknotes in #ndia under +ection "" of the
3eserve 5ank of #ndia (ct, 19D8$ The 3eserve 5ank has the responsibility for
providing banknotes throughout the country and also for maintaining the &uality of
the banknotes$I
H(t 11$ per cent, the growth in value of banknotes outpaced the growth in volume
terms ($0 per cent) in "01"!1D$ <otes of denominations of _.00 and _1,000
together accounted for around MD per cent of the total value of banknotes in
circulation during the yearI

HThe total supply of notes received from the ,resses in volume terms increased by M$
M
#ear Detection at &otal
,eserve Bank -ther .anks
1 2 ' !
2010+11 !%2'% '*0'72 !"'%(07
/10"!0 /)*"(0
2011+12 '7(*0 !)'!(% %211%%
/7"20 /*2")0
2012+1' 2*200 !(*0%2 !*)2%2
/%"*0 /*!"10
N'$8 Figures in parentheses represent the percentage share in
total"
per cent in "01"!1D Pthe supply of coins also increased during the period by 1"$9 per
cent over the previous yearI$
LA r o + % ! /=1/ ("ll"o% &"ece# of #o"le! (a%)%o$e# >201= &er ce%$ of (a%)%o$e# "%
c"rc+la$"o%?

'ere &roce##e! a%! remo-e! from c"rc+la$"o% !+r"%g 20/2;/:M$
LThe number of banknotes withdrawn from circulation and eventually disposed of at
the 3eserve 5ank offices increased over the previous year by D.M million pieces$
During "01"!1D, around M$9J billion pieces were processed through .9 Currency
Aerification and ,rocessing +ystems (CA,+) and the remainder were disposed of
under other modes$
Due to the increased use of <+0s, bank branches detected more than 98 per cent of
the total detected counterfeit banknotes during "01"!1D (Table A###$J)$ %f the
counterfeit notes detected by the 3eserve 5ank in "01"!1D, around J9 per cent
("D,09D pieces) were detected in the soiled note remittances by banks and about "1
per cent (,10J pieces) were tendered over 3eserve 5ank countersI$
BD+r"%g 20/2;/:, $he !e$ec$"o% of co+%$erfe"$ %o$e# "% $he !e%om"%a$"o% of T/000
"%crea#e! (/H12 &er ce%$, 'herea# !e$ec$"o% of co+%$erfe"$ T500 a%! T/00 %o$e#
!ecrea#e! ( <1H &er ce%$ a%! /21: &er ce%$, re#&ec$"-el, "% com&ar"#o% '"$h
$he &re-"o+# earM1
N+m(er of Co+%$erfe"$ No$e#
De$ec$e! ((pril!0arch)
(<o$ of ,ieces)
The total expenditure incurred on security printing (note forms) during "01"!1D
(@uly!@une) was _"M$J" billion as compared to _ "J$D billion in "011!"01" (@uly!
@une)$ The increase in security printing charges by _1$D billion (.$0 per cent) over
the previous year was mainly on account of increase in the supply of banknotes
during "01"!1D$ *xpenditure on remittance of treasure has increased from
9
_."M million in "011!1" (@uly!@une) to _81 million in "01"!1D$

?ere again the blame is put on the employees working in the chests and
branches handling sorting and counting machines when something goes wrong
and many times amount is recovered form them leave alone other disciplinary
proceeding launched against them for negligence$$$ 5ank employees through
their unions have seen impressing upon the administration that when such
notes escape the scrutiny of he machines it has to be treated as a risk inherent
in the system itself$ To arrive at an amicable solution which will safeguard the
interest of the #nstitution as well as the individual union have been impressing
upon the administration to arrange for a meeting with the administration$
7nfortunately notwithstanding the repeated assurances from the administration
such a meeting is yet to take place$
The $o$al %+m(er of acco+%$# &er em&loee for PS3 AND RR3B# "# $he
h"ghe#$ e-e% a# of f"%a%c"al ear 20001
S)5(+,7 T3, H!"%5 15&!",&& '!", :,%",&%#$= S,8 03= 20031
(n analysis of the 5anking +tatistics 3eport 1or The Gear "000, 35# (nnual
3eport makes it pellucid that, Hwhen it comes to productivity and profitability of
the banking sector, it is found that the total number of accounts per employee, at MM.
for (335s)$, MD8 for public sector banks, other scheduled banks .0. $ #t is highest for
regional rural banks $For fore"g% (a%)# "$ "# 27/, $he lo'e#$ amo%g#$ $he (a%)
gro+&#1 5ut a further break!up into credit and deposit accounts shows that the large
number of accounts per employee in 335s is because of higher deposit rather than
credit accounts$ This is true in the case of other traditional bank groups as well$
The 'or)force com&o#"$"o% #ho'# $ha$ fore"g% (a%)# ha-e $he h"ghe#$
&erce%$age ></? of off"cer#$ +urprisingly, 335s have the highest percentage (81) of
officers amongst #ndian banks$ Aro+%! 50 &er ce%$ of $he #$aff "% I%!"a% (a%)# "#
cler"cal a%! 20;:5 &er ce%$ #+(or!"%a$e1
C)"&!%,(!". -3, +)5"-($H& )/,(#'' (,F5!(,0,"-= 63#- !& )8-!0#' 6)(2*)(+, 0!DI A&
# '#(., 8)(-!)" (A0 8,( +,"-) )* -3, 8)85'#-!)" &-!'' '!/,& !" (5(#' #(,#&= &8(,#%!".
-3, 1#"2!". ",-6)(2 #"% -3, 1#&!+ #+-!/!-!,& )* &#/!".& 0)1!'!&#-!)" #"% ',"%!".
&3)5'% (,0#!" -3, +)(, )1<,+-!/,4 M5+3 )* (5(#' I"%!#H& +(,%!- ",,%& #(, &-!'' 0,-
1$ ')+#' 0)",$',"%,(&4
3r"%g"%g cler"cal a%! #+(or!"%a$e #$aff "%$o $he ma"%#$ream '"ll &romo$e
&ro!+c$"-"$1 Th"# 'o+l! %o$ o%l lo'er $he co#$ of #er-"ce (+$ al#o e%ha%ce
&rof"$# a%! (+#"%e## -ol+me#1
J0
(s far as central banking is concerned, its activities broadly comprise currency
management, supervision of banking activity and formulation of monetary policy$
Country!wise data on central bank staff per 1, 00,000 population is rather revealing$I
S)5(+,7 T3, H!"%5 15&!",&& '!", :,%",&%#$= S,8 03= 20031
O-er $he &er"o! $he %+m(er of acco+%$# &er em&loee ah# "%crea#e! ma%"fol!
"% RR3C# a%! P+(l"c Sec$or 3a%)# '"$h $he &+(l"c #ec$or (a%)# alo%e
+%!er$a)"%g o$her #cheme# $o (+$$re## f"%a%c"al "%cl+#"o% a# &er go-er%me%$
!"c$a$e# , B%!2#-&> a%! or o$her '"#e1
Contrary to the general impression that labour cost and wage expenses are
going up, it would be observed as shown below that over the years, the ratio of
wages to total expenses has slided down$
9age a# $o % $o$al e8&e%#e#
#n public sector banks Gear /
:/;:;200H /=1<<
D1!D!"009 1D$MM
D1!D!"010 18$J9
D1!D!"011 1J$.0
:/;:;20/2 /:1F2
The a(o-e o(#er-a$"o%# of m #$+! ha-e (ee% e%!or#e! ( e8&er$#, &rof"c"e%$
&er#o%%elC# "% (+#"%e## #chool# a# a!!+ce! (elo'$
S$+!"e# of e8&er$# o% "%crea#e! &ro!+c$"-"$ a%! eff"c"e%c of &+(l"c #ec$or
em&loee#
A? ( study on ,roductivity and Cost, a comparative study of banks in #ndia
during 199J to "00M by +harad >umar and 0 +reeramulu, published by the
3eserve 5ank of #ndia (35#) as one of its occasional papers reveals the
following ( ource The ,inancial +xpress, Tuesda" )une 87,75872
3+#"%e## &er em&loee for $ra!"$"o%al (a%)#R&+(l"c #ec$or a%! ol!
&r"-a$e #ec$or (a%)#Rha# co%$"%+o+#l "m&ro-e! !+r"%g $he &a#$ /2 ear#
( %earl F127 $"me#1 Em&loee#P Pro!+c$"-"$ a%! Co#$, a com&ara$"-e
#$+! of (a%)# "% I%!"a !+r"%g /77F $o 200H by +harad >umar and 0
+reeramulu, published by the 3eserve 5ank of #ndia (35#) as one of its
J1
occasional papers, noted that business per employee for traditional banks has
gone up from 3s J.$"M lakh to 3s .89$"1 lakh between 199J and "00M
LI% ca#e of mo!er% (a%)# R %e' ge%era$"o% &r"-a$e #ec$or (a%)# a%!
fore"g% (a%)# R $he (+#"%e## &er em&loee ha# "%crea#e! o%l :10< $"me#,
le## $ha% half com&are! $o $he "%crea#e for $ra!"$"o%al (a%)# !+r"%g $he
#ame &er"o!1 #t has, however, marginally declined during 1999, "001, "00",
"00. and "00J compared with the previous years for the modern banks$ The
ratios of business per employee between modern and traditional banks have
decreased drastically from .$"M times in 199J to "$"1 times in "00M, indicating
that the gap in business per employee between modern banks and traditional
banks is consistently reducing due to the efforts made by the traditional
banks,I said the study$
Talking about the profit per employee, the study revealed that this parameter
has increased both for traditional and modern banks from 199J to "00M$
Ho'e-er, $h"# "%crea#e ha# (ee% #"g%"f"ca%$l h"gher for $ra!"$"o%al (a%)#
><1F7 $"me#? com&are! $o mo!er% (a%)# >21F: $"me#? !+r"%g $he &er"o! of
/2 ear#1 There has been decline of profit per employee during 1999, "001and
"00. compared with the previous year both for traditional and modern banks,
indicating effect of some external factors impacting profitability of banks
during these years$
The em&loee co#$ a# a ra$"o of o&era$"%g e8&e%#e# "% $ra!"$"o%al (a%)#
ha# rema"%e! more or le## co%#$a%$ from /77F $o 2002, a%! re!+ce!
gra!+all $hereaf$er$ #n case of modern banks, the ratio fluctuated within a
narrow range and reduced marginally up to the year "00, before showing an
upward trend during "00J and "00M$
The employee cost to operating expenses for traditional banks remained more
than double for modern banks till "00$ Th"# ra$"o, ho'e-er, !ecrea#e!
#"g%"f"ca%$l !+r"%g 200F a%! 200H >/1FF a%! /1<5 $"me#, re#&ec$"-el?,
"%!"ca$"%g $ha$ effor$# ma!e ( $he $ra!"$"o%al (a%)# $o re!+ce $he 'age
("ll# "% rela$"o% $o o&era$"%g co#$ ma!e a% "m&ac$ !+r"%g rece%$ &er"o!,
#a"! $he #$+!1
(s regards employee cost to total business, it has been consistently reducing
for traditional banks from 1$8./ in 199J to 0$M/ in "00M$ %n the other hand,
it has been increasing for modern banks in a very narrow range from 0$.J/ to
0$8/ up to "008, thereafter increased drastically to 1$"D/ in "00. and again
reduced to 0$MM/ in "00M$ This $re%! clearl "%!"ca$e# $ha$ $he $ra!"$"o%al
(a%)# ha-e reache! $he le-el 'here $he ca% -er 'ell com&e$e '"$h $he
J"
mo!er% (a%)# a# regar!# $o $he marg"%al co#$ of e8&a%!"%g %e' (+#"%e##
>!e&o#"$# &l+# a!-a%ce#?1
2hile comparing the 1"!year data from 199J to "00M on productivity factors
like business per employee, profit per employee and employee cost factors like
employee cost to total business, employee cost to total assets and employee
cost to operating expenses, it was observed that the performance of the modern
banks like foreign and new private sector banks was much superior than the
traditional banks like public sector and old private sector banks$
?owever, the gap between the performance of modern and traditional banks on
all the five variables has shown a decreasing trend, which$ has significantly
reduced during the period of 1" years under study\
#t is interesting to o(#er-e $he re!+ce! ga& "% (+#"%e## &er em&loee o'"%g
$o "m&ro-e! &erforma%ce of $ra!"$"o%al (a%)#1 Th"# ga& "# l")el $o (e
re!+ce! f+r$her !+e $o cer$a"% mea#+re# $a)e% ( $he $ra!"$"o%al (a%)#
rece%$l$ ?owever, the trend has to be closely monitored to come to a firm
conclusion$
#n case of modern banks) new generation of private sector banks B foreign
bank J -3, 15&!",&& 8,( ,08')$,, 3#& !"+(,#&,% )"'$ 340B -!0,& %5(!".
1KKA -) 2008= ',&& -3#" 3#'* +)08#(,% -) !"+(,#&, *)( -(#%!-!)"#' 1#"2&L I-
3#&= 3)6,/,(= 0#(.!"#''$ %,+'!",% %5(!". 1KKK= 2001= 2002= 200C #"% 200A
+)08#(,% -) -3, 8(,/!)5& $,#(& !" (,&8,+- )* 0)%,(" 1#"2&
The em&loee co#$ a# a ra$"o of o&era$"%g e8&e%#e# "% re#&ec$ of $ra!"$"o%al
(a%)# ha# rema"%e! more or le## co%#$a%$ from /77F $o 2002 a%!
$hereaf$er re!+ce! gra!+all
#n case of modern banks, the ratio fluctuated within a narrow range and
reduced marginally up to the year "00 before showing upward trend during
"00J and "00M
>3? (nother study on ,roductivity, cost and profitability performance of scheduled
commercial banks in #ndia ! a comparative evaluation by >$ +arala 3ao (ssistant
,rofessor, Tata #nstitute of +ocial +ciences, 0umbai, #ndia gives the startling
revelations as under, grinding to dust the canard let loose by business houses, vested
interests, with obli&ue motives about performance and productivity of public sector
bank employees$
3+#"%e## &er em&loeeD The (+#"%e## &er em&loee of $ra!"$"o%al (a%)#
"%crea#e! 21<H $"me# >R#1:21HF m"ll"o% $ o R#1HH120 m"ll"o%? from $he ear 2005
JD
$o 20//, 'herea# "% ca#e of mo!er% (a%)# $he "%crea#e "% o%l 01F7 $"me#
>R#17/155 m"ll"o% $o R#1//=1<0 m"ll"o%?1 The (+#"%e## &er em&loee ha#
marg"%all !ecl"%e! !+r"%g 200F "% ca#e of mo!er% (a%)#1 The ra$"o# (e$'ee%
$he mo!er% a%! $ra!"$"o%al (a%)# ha-e #ho'% a #"g%"f"ca%$ !ecl"%e from 21FH
$"me# "% 2005 $o /1:0 $"me# "% 20//, "m&l"%g $ha$ $ra!"$"o%al (a%)# ma!e a
#"g%"f"ca%$ "m&ro-eme%$ o% $h"# "%!"ca$or1 The gap between the modern and
traditional banks reduced significantly from 8J$1. percent in "00. to 1D$0" per cent
in "011(J"$D9 per cent reduction
Prof"$ &er em&loee: $he &rof"$ &er em&loee of $ra!"$"o%al (a%)# !+r"%g $he
&er"o! 2005;20// "%crea#e! from R#101/: m"ll"o% $o R#10155 m"ll"o% >=1:= $"me#
"%crea#e?, 'h"le for $he mo!er% (a%)# $he "%crea#e "# /1H0 $"me# >R#1/10/ m"ll"o%
$o R#1/1H2m"ll"o%?1 I$ "# &er$"%e%$ $o %o$e $ha$ $he &rof"$ &er em&loee
!ecl"%e! "% 20/0 a# com&are! $o &re-"o+# ear for mo!er% (a%)#1 The ra$"o#
( e $ 'e e % mo!er% a%! $ra!"$"o%al !ecl"%e! from F17< $"me# "% 2005 $o :1:/
$"me# "% 20// "%!"ca$"%g "m&ro-eme%$ #ho'% ( $ra!"$"o%al (a%)# o% $h"# fro%$1
The ga& (e$'ee% mo!er% a%! $ra!"$"o%al (a%)# re!+ce! from FF1F0 &er ce%$ "%
2005 $o 5:1<F &er ce%$ "% 20//>:017: &er ce%$ re!+c$"o%
Ne$ "%come &er em&loee: ,er employee net income of traditional banks
increased from 3s$ 0$9M million in "00. to 3s$"$"" million in "011 ("$" times
increase) and that of the modern banks reported an increase from 3s$"$JM million
to 3s$.$8D million (1$9. times increase) during the same period$ The gap between
the traditional and modern banks revealed a slight decline till "00J and thereafter
assumed low to moderate fluctuations for the remaining years during the period of
the study$
3+#"%e## &er (ra%chD The business per branch of traditional banks increased
from 8.$8 million in "00. to 3s$108M$81 million in "011 ("$"9 times increase)
,whereas in case of modern banks the increase in only 1$J times$ #t is pertinent to
note that the modern banks have shown exemplary performance through out the
period as compared to traditional banks The gap between the modern and traditional
banks reduced significantly from 18$J" in "00. to 1.D$"0 in "011 ($99 per cent
reduction)$
Prof"$ &er (ra%chD The profit per branch of traditional banks increased
steadily during the period "00.!"011 from 3s$"$0 million to 3s$$. million
(D$"1times increase), whereas in case of modern banks, profit per branch increased
from 3s$..$1 million to 1DD$1 million ("$81 times increase) during this period$
0odern banks reported decline in profit per branch in "010 as compared to the
previous years$ The gap between the modern and traditional banks reduced
marginally from 9$D0 per cent in "00. to 9$0 per cent in "011 ("$8M per cent
reduction)
J8
S$aff co#$ a# % $o o&era$"o%al e8&e%#e#D The staff cost as a ratio of operating
expenses with regard to traditional banks is more or less constant with slight
fluctuations towards the close of the period$ I% ca#e of mo!er% (a%)#, $he ra$"o#
re-eale! a +&'ar! $re%! !+r"%g $he e%$"re &er"o! The gaps between the
modern and traditional banks on this indicator reduced from DJ$JJ per cent in
"00. to "0$D9 percent in "011 (8$0" per cent reduction) implying the efforts
made by traditional banks to reduce the percentage staff cost to operating expenses$
S$aff co#$ $o %e$ "%comeD The staff cost to net income of traditional banks and
modern banks remained more or less constant with slight to moderate fluctuation
during the period$ The staff cost to net income of traditional banks were almost
double the cost of modern banks during the year "00., "00 and "00J and
thereafter showed a declining trend revealing significant efforts made by
traditional banks to be cost efficient$ The gap index between the traditional and
modern banks reduced from DM$99 per cent in "00. to "D$D9 per cent in "011 (80$0"
per cent reduction)
S$aff co#$ a# % $o $o$al (+#"%e##: staff cost to total business of traditional banks
revealed an declining trend from 0$9 per cent in "00. to 0$J1 per cent "010 and
then an increase in "011, while in the case of modern banks the staff cost to total
business increased form 0$D per cent in "00. to 0$9 per cent in "009, then
declined in "010 and again increased in "011$ The staff cost to total business of
modern banks remained significantly lower as compared to traditional banks up to
"00, but the traditional banks overtook the modern banks during the next . years
of the study period$ During this period the gaps between the modern and traditional
banks reduced drastically from "0$J. per cent to !11$11 per cent (1.D$.8) per cent
reduction
Re$+r% o% A##e$#D The $ra!"$"o%al (a%)# ha-e re&or$e! a #$ea! "%crea#e "%
$erm# of ROA !+r"%g $he #$+! &er"o! e8ce&$ for $he ear 200F a%! 20/0
'here"% $he ROA 'a# re&or$e! #"g%"f"ca%$l h"gh a%! #"g%"f"ca%$l lo' a#
com&are! $o $he &re-"o+# ear#1 The ROA ha# "%crea#e! /1<< $"me# >0155 &er
ce%$ $o 017/ &er ce%$? from 2005 $o 20//1 I% ca#e of mo!er% (a%)# $he ROA ha#
"%crea#e! /12/ $"me#1 The ra$"o# of ROA (e$'ee% mo!er% (a%)# a%! $ra!"$"o%al
(a%)# ha-e !ecrea#e! from 212= $"me# "% 2005 $o /157 $"me# "% 20//1 The ga&
"%!e8 (e$'ee% $ra!"$"o%al a%! mo!er% (a%)# re!+ce! from :H12 "% 2005 $o
221HH "% 20// >=01/0 &er ce%$? "m&l"%g $he $ra!"$"o%al (a%)# ma!e effor$#
$o "m&ro-e o% $he &rof"$a("l"$ fro%$1
I%$ere#$ "%come a# % $o To$al "%comeD #t can be observed that the income
interest to total interest of traditional banks remained more or less constant with
sight fluctuations in their year to year performance and so is the case of modern
banks during the study period$ The ra$"o# (e$'ee% $ra!"$"o%al (a%)# a%! mo!er%
J.
(a%)# !ecrea#e! marg"%all from /1=2 $"me# "% 2005 $o /1/5 $"me# "% 20//1 The
ga& "%!e8 (e$'ee% $ra!"$"o%al a%! mo!er% (a%)# re!+ce! from /F1:H "% 2005
$o F10< "% 20// >571:H &er ce%$?
S&rea! a# % $o $o$al a##e$#: The traditional banks reported an increase in "00 as
compared to the previous year, subse&uently registered decline from "00J to "010
and significant increase in the year "011$ #n case of modern spread as / to total
assets increased from "$J percent in "00. to D$". per cent in "011(1$1J times
increase)$ *xcept for the year "00., modern banks have reported higher ratio on this
indicator during the period of study$ The gaps between traditional banks and
modern banks during the period of study revealed year to year fluctuations$
Cre!"$ ;De&o#"$ Ra$"o: Credit !deposit ratio of traditional banks increased by 1$"J
times (.J$89 per cent to JD$1M per cent) from the year "00. to "011$ #n case of
modern banks the credit !deposit ratios were more or less constant except for the
year "010$ The gap index between traditional and modern banks reduced from
1M$08 per cent to .$J. per cent (M$1D per cent)
The e8&er$ (a#e! her 6+#$ co%cl+#"o%# af$er o(6ec$"-e a%al#"# a# (elo'D
The analysis of data on productivity ratios i$e$ 5usiness per employee, ,rofit per
employee <et income per employee, 5usiness per branch, ,rofit ,er 5ranch reveal
that modern banks have outperformed the traditional banks$ Ho'e-er $he ga&
(e$'ee% $he mo!er% (a%)# a%! $ra!"$"o%al (a%)# reg"#$ere! a !ecl"%"%g
$re%!# o% all $he f"-e "%!"ca$or# !+r"%g $he &er"o! 2005;20//1
%n cost efficiency ratios, modern banks out performed traditional banks in terms
+taff cost as / to operational expenses and +taff cost to net income$ Tra!"$"o%al
(a%)# reg"#$ere! e8ce&$"o%al "m&ro-eme%$ &o# $ 200< '"$h regar! $o S$aff co#$
a# % $o $o$al (+#"%e## ( reg"#$er"%g lo' o% $h"# ra$"o1
I% $erm# of &rof"$a("l"$, mo!er% (a%)# ha-e reg"#$ere! a(o-e $he (e%chmar)
>more $ha% o%e &er ce%$? o% ROA, 'h"le $he $ra!"$"o%al (a%)# !"#&lae! a
#"g%"f"ca%$ "m&ro-eme%$ o% $h"# ra$"o !+r"%g $he &er"o! of #$+!$
9"$h regar! $o "%$ere#$ "%come a# % $o $o$al "%come, $ra!"$"o%al (a%)#
o+$&erforme! $he mo!er% (a%)# 'h"le mo!er% (a%)# &erforme! (e$$er $ha%
$ra!"$"o%al (a%)# "% $erm# Cre!"$ ;De&o#"$ ra$"o1
S)5(+,7 I"-,("#-!)"#' M)"-3'$ R,*,(,,% M)5("#' )* R,&,#(+3 !" M#"#.,0,"- N
T,+3")').$ ISSN-2320-00A3 V)'50, II= M#(+3>2013
O444 -3, %(!/!". *)(+, !" -3, 8#-3 #3,#% 6!'' 1, -3, !00,"&, +#8#1!'!-!,& -3#- 6,
8)&&,&& !" -,(0& )* 350#" (,&)5(+,4 I" -3, $,#(& -) +)0, -3, P350#" 1!#&H !& '!2,'$
-) .,- &-()".,( #"% -3, F5#'!-$ )* 350#" (,&)5(+, 6)5'% 1,+)0, -3, +5--!". ,%.,
)* +)08,-!-!/,",&&444 O
J
Dr 3"mal Jala%1 1ormer =overnor of 3eserve 5ank of #ndia
JUST CONCEUSIONSD
#f the influx of new recruitment continues in the same trend not
commensurate with the vacancies arising due huge retirements as result
of superannuation and voluntary retirement under pension regulations,
and other wastages, increase in volume of business, rapid branch
expansion, the workload on the existing employees has increased
manifold$
#t is estimated that J.,000 bank employees are set to retire by "01.$
Taking into account the present trend of huge attrition rate among the
new recruits mainly due to better salary packages and perks privileges
offered by comparable peers in pubic and private sector there is need for
better compensation package to retain young employees in future$
#n the context of all!round increase in the cost of living, erosion in
wages of the employees, spiraling price rise, increased work load on the
employee, free6ing of recruitment, contribution of the employees in
improving the business of the 5ank, present wage structure with
comparable peers o+r !ema%! of m"%"m+m "%crea#e of 25% "% &a
#l"& com&o%e%$# "% $he /0
$h
3"&ar$"$e "# fa"r , 6+#$ J r"gh$
EAPEODIN5 THE 2GTHS UN@EIEIN5 FACTS AND TRUTHD
RE@EAEIN5 STATISTICSD
(fter a gap of D months with the last negations held on 18!D!"018 which was
especiall" for nonEmonetar" issues raised b" the unions, another round of
discussions took place with #5( on 1D!!"018 $
#5( informed, profits of the banks have come down as on D1!D!"018 a n d
therefore they can offer maximum of // %> !"+(,#&, )* 0,#.,( 1 E )5(
,083#&!&! ) on the cost of ,ay +lip components of the wage bill which
would amount to R&43=QBC +()(,& and which would be exclusive of other costs
on retirement benefits, L1C, hospitali6ation expenses, etc +ince negotiating
unions re'ected the offer of 11/ increase, #5( wanted to know the expectation
of the union$ ( representative of the umbrella of nine unions informed that
their mi n i mu m expectation is "./ increase in the ,ay +lip components
cost$
JJ
#5( expressed their total inability to accept the same as it is beyond the paying
capacity of the 5anks$
Thereafter there is virtual breakdown in talks and even as on date stalemate
continues$
#n all the previous settlements salary increase was given a load to total
establishment expenses$ #n this wage negotiations we have been offered on fixed
pay components $(s against the total establishment expenses of 3s$."9" crores
the pay slip component is only 3s$D1.0D crores$
#n other words pay slip component P establishment expense R ..$9/
2e shall now explain the concepts pay slip cost and establishment cost on
reverse logic terms in the 9
th
bipartite #5( offered (for award staff) 3s ".JJ
crores or 1J$./ of establishment cost$
%ut of which amount allotted to pay slip components is 3s$1.18 crores or 10$D
/( apporx$)
Therefore the formulae for conversion factor from pay slip cost to establishment
cost works out to 1J$. divided by 10$D, which is e&ual to 1$J0$
A&&l"%g $he a(o-e re-er#e log"c 'e ca% co%#$r+c$ $he follo'"%g $a(le for
ea# +%!er#$a%!"%g1
Dema%!
Pa#l"&
co#$ "%
%
Pa#l"&
co#$ "% R#1
>"% crore# ?
E#$a(l"#hme%$
co#$ "% %
E#$a(l"#hme%$
co#$ "% R#
> "% crore#?
I3A la#$ offer //% :=<5 /H1<7% /0520
U%"o%# !ema%! 25% FHF5 =21=H 2:7/2
D"ffere%ce >for
'h"ch #$alema$e
co%$"%+e# ?
/=% ==/0 2:1F7 /::7/
<ow we revert back to Table ( which # am once again reproducing to 'ustify that our
demand is achievable$
FOR THE PERIOD 200<;200F J 20//;20/2
200<;200F 20//;/2 I%crea#e CA5R%
JM
>"% R#1Cr1? >"% R#1Cr1? "% %
Deposits 1998"00 8DJ"9M. 119$"M "1$J/
#nvestments 8M. 1D"M.D8 99$M" 1M$9
(dvances 188018 DD0.D" 1"9$.D "D$1
Total 5usiness D8D8D8 JJM1J 1"D$.M
#nt$income 181M. DD1M ""D$11 ""$"
#nt$ expended 10190 "D11.D 1"$J0 ""$J
<et int$ income """. 1D.1. 11J$"1 "1$8
5usiness per
employee (in
3s$Lakhs)
8J1$1M 101D$D 11.$1"
,rofit per
employee (in
3s$ Lakhs)
"$J .$9D 118$M.
+ource 3$5$#
I '"ll %o' e8&la"% ( mea%# of Ta(le 3, C a# ho' o+r !ema%! of 25 % h")e "%
&a #l"& co%#$"$+$e o%l "%f"%"$e#"mal &erce%$age of (+#"%e## m"8 , "% o$her 'or!#
-al+e a!!e! ( la(o+r (e$'ee% 200< $o 20/2 1
TA3EE 3
20//;/2 Pa #l"&
25%
E#$a(l"#h
me%$ %
I%crea#e o-er
200<;200F
Pa
Sl"& %
E#$a(l"#h
me%$ %
To$al
3+#"%e##
F<FH</F 01/0 01:/ 8"88"J1 0$1M 0$.
I%$ere#$
"%come
:<<:/H 21/= <152 "0"1DD D$M9 11$M"
I%$ere#$
e8&e%!e!
2://5: :1=0 /01:= 1"919D $09 1M$.0
Ne$
"%$ere#$
"%come
/:5/<5 51H2 /F1<7 J"980 10$J9 D"$JM
TA3EE C
>Co%#$r+c$e! o% $he !"ffere%ce (e$'ee% I3A offer a%! U%"o%# !ema%!?
Pa #l"& 25% E#$a(l"#hme%$ I%crea#e I%crea#e
J9
20//;/2 Co#$ %
20//;/2
(+#"%e##
Pa #l"&%
(+#"%e##
E#$1 co#$ %
To$al
3+#"%e##
0105 01/F 0$10 0$D1
I%$ere#$
"%come
/120 <152 "$1M $"
I%$ere#$
e8&e%!e!
/170 51F7 D$81 10$D
Ne$ "%$ere#$
"%come
:12< 7170 $08 1M$D.
Ta)"%g "%$o acco+%$ E#$a(l"#hme%$ e8&e%!"$+re for 20// "# 5<272 cr, o+$ of
'h"ch $he &a #l"& com&o%e%$ "# R#1:/50: crore#1 The "%crea#e of 25%
#o+gh$ ( +# $o a'ar! #$aff a# &er co%-e%$"o%al !"#$r"(+$"o% 'age loa!
>5=% $o a'ar! #$aff? 'he% arr"-e! a# a &erce%$age of $o$al (+#"%e## m"8
for 20//;20/2 '"ll 'or) o+$ a mere 010=%, 010H% of I%$ere#$ "%come,
/1:5% of I%$ere#$ e8&e%!e! a%! 21:/% of Ne$ "%$ere#$ "%come 'h"ch (
a% #$a%!ar!# "# %o$ o%l fa"r (+$ 6+#$ a%! r"gh$1
I# %o$ &erce%$age of $o$al (+#"%e## m"8 for 20//;20/2 'h"ch 'or) o+$ a
mere 010=%, $o$al (+#"%e## m"8, 010H% of I%$ere#$ "%come, /1:5% of
I%$ere#$ e8&e%!e! a%! 21:/% of Ne$ "%$ere#$ "%come for $he -al+e a!!e!
( la(o+r ( #'ea$, $o"l, !e-o$"o% a%! !e!"ca$"o% a mere &"$$a%ce a%!
ca%%o$ (e !e%"e! "# *+e#$"o% $o (e &o%!ere! ( #$a)e hol!er#1
There are reports in news papers that soon after Prime Minister launched
the scheme Pradhan Mantri Jan Dhan Yojana on this independence day
Sources in the fnance ministry said that the PMO is keeping a watch on
banks' rising NPAs, estimated to be Rs 2 lakh crore.
ource% ee% CN. F(!%#$, 7< .ugust 7589, http%JJwww#dnaindia#comJindiaJreportE
da"E8EofEpmEnarendraEmodiEsEmantraEtoEendEfinancialEuntouchabilit"EseesE83EcroreE
ban!EaccountsEcreatedE75893392
In absolute terms our demand of 25% increase in pay slip components it
will work out measly 37.85%%. if we calculate on the diference between
IBA ofer and unions demand for which stalemate persists it will
infnitesimal fgure of 22 %, which the bank employees THE
PERFORMING ASSETS assures the Government they will recover from
M0
the defaulters no holds barred in express time. That is the reason we aver
that our demand is sacrosanct!
REJECTION OR NON CONSIDERATION OF OUR JUST,
REASONA3EE DE2AND 3G THE 5O@T4 I3A CO23INE IS
2ENDACIOUS, PERFIDIOUS AND PREPOSTEROUS1
M1
CHAPTER 6 V
JUSTIFICATION @D O+r Dema%! Demol"#he# U%$r+$h# J Fal#ehoo!#
,aul @oseph =oebbels !a =erman politician and 3eich 0inister of ,ropaganda in
<a6i =ermany from 19DD to 198. in his lecture on the F5ig LieI said LIf o+ $ell a
l"e ("g e%o+gh a%! )ee& re&ea$"%g "$, &eo&le '"ll e-e%$+all come $o (el"e-e "$M1
This theory popularly termed 5oe((el# $heor influenced (dolf ?itler, =erman
Chancellor, leader of the <a6i party, to make a statement 2a)e $he l"e ("g, ma)e "$
#"m&le, )ee& #a"%g "$, a%! e-e%$+all $he '"ll (el"e-e "$1
2hen ever bipartite negotiations of the bank employees are in progress we had
witnessed as in the past, a systematic ,and deliberate attempt is of calumny, slander ,
misinformation and canard is let loose, vomited by Khigher ups- , Kcorridors power-,
chorused through their accordions and paraded in the daily press (now in electronic
media too) to fudge and sidetrack our 'ust demands through prevarications in tune
with the above Goebbels theor" $
These self proclaimed unauthentic, irresponsible statements couched with spurious
statistics by the Khigher ups- with any rationale, logic, investigations or study gets
accelerated push when ever bank employees are forced to observer strike in
pursuance their 'ust demands and is covered by the fourth estate, hood winking our
fair demands, without any cross verification or truth$
1or example even during this 10 bipartite negotiations, news paper were agog
covering statement of these Khigher ups- such as
tateErun ban!sH average salar" overta!es that of private peersH
Gtaff costs higher at public sector ban!sH
R+mplo"eeEbenefit provisioning to hit public sector ban!s hardH
G.ll profit canHt be used to pa" higher wagesH
.nd son, so onM
+uch irresponsible utterances by Khigher echelons-, honchos are new to new to all
us$
6ar! Twain, was an (merican author and humorist said HThere are three kinds of
lies: lies, damned lies and statisticsI $as re'oinder to the false propaganda unleashed
by forces inimical to our 'ust demands ,we hasten to rewrite 0ark twain-s &uote as
There are% lies, damned lies and statistics of honchos in the Indian ban!ing industr"
M"
B5- I 3#/, !08'!+!- *#!-3 #"% &,'* 1,'!,* -3#- !" -3, &5"&3!", #"% (,#'!-$ )* )5(
&-(5..',& *)( <5&- +#5&,& -3,&, )88)(-5"!&-&= 6,,%& #"% 8)!&)")5& !/$= &-#"%
,D8)&,% a%! )5( 1,-(#$,(& 6!'' 1,-(#$ -3,0&,'/,&
3ight from the +en, +astri (nd Desai Tribunal days these strange arguments
advocated by the bank lords before the tribunals for the bank-s disputes and now by
#5(, stand elo&uent witness to this conviction
%n the expiry of first bipartite in 19, when bank unions raised demand for second
bipartite as per the tenor of first bipartite, #5( came out report of "J1 pages to
<ational Council %f (pplied *conomic 3esearch <ew Delhi %n 2age +tructure #n
#ndian 5anking ,ublished 5y <one %ther Than The #ndian 5anks K(ssociation,
5ombay on 1M
th
(pril 199 misrepresenting facts that there is substantial increase in
bank employees salary already$
2e had often witnessed, The 1inance 0inistry-s 5ureau of ,ublic *nterprises (5,*),
after discussions with the representatives of the managements only (%o$ '"$h $he
+%"o%# al#o) of the public enterprises advise the (dministrative 0inistries with
regard to the finali6ation of the terms of the long term settlement of wage structures$
1or example 5ureau of ,ublic *nterprises in its communication of <ovember 1",
19M1 to the various administrative ministries, explained how it has calculated the cost
of likely wage settlements in the public sector undertaking and had set out the
Hguidelines (blue print for wage free(eN) which the ,ublic +ector 0anagements are
re&uired to adhere while entering into negotiations with the unions in their respective
undertakingsI
#n 19M0, with the foreign reserves depleted, and #ndia was in verge of bankruptcy, unable
to pay the dues abroad, the then =overnment was constrained to enter into an agreement
with #01 for X . billion loan$ The #01 in return demanded stringent conditionalities and
introduction of structural ad'ustment policy$ (ccording to #01 memorandum 19M1,
#ndia had to carry out a liberali6ed import regime with liberal import of capital and
technology including relaxation in foreign subsidies to all kinds of exporters,
replacement of direct taxes by regressive indirect taxes, discouraging the public
distribution system and encouragement of open market policies even regarding food,
wage free6e and necessary trade union law amendments including new anti!strike lawsO
and all round encouragement to private sector with regard to investment, production and
trade$ This package of policiesO became the basis for #ndia-s import!pushed export
oriented growth strategies in 19M0-s$ 2ith this loan the seed for <*, which sprouted
under subse&uent regimes began to proliferate in subse&uent governmentPs era and
thereafter$ I$ #ho+l! (e %o$e! "$ "# %o$ $ha$ $he NEP 'a# "%$ro!+ce! for $he f"r#$ $"me
"% /77/ "% $he co+%$r a# #ome$"me# ma!e o+$ $o (e ( $he lef$ &ar$"e# "% o+r
co+%$r1 I% $+%e '"$h $he &ol"c"e# of I2F, e-e% "% /7H/, go-er%me%$ of I%!"a
o&e%e! : &o"%$ %e' cha&$er "% I%!+#$r"al rela$"o%# I or!"%a%ce, %o$"f"ca$"o%#, a%!
MD
!"rec$"-e#1 (greement, settlements, customs, practice and culture of individual banks
were sealed in airtight containers and confined to the Department of (chieves (for future
historians to have a field day)$ <egotiations, discussions not only consume time and
energy, but also re&uire the logic and sense to meet sagacity of unions$ +o even
individual banks internal agreements on housing loans, promotions, transfers and other
welfare schemes etc$ as well some service conditions in the bipartite signed in
accordance #D acts were replaced by directives 4 unilateral, arbitrary and often
meaningless$ #n tune with above adverse trend as per the advise of 3+rea+ of ,ublic
*nterprises (5,* of the (dministrative 0inistries set out the directives camouflaged
as Hguidelines (blue print for wage free(eN) which the ,ublic +ector 0anagements
including #5( are re&uired to adhere while entering into negotiations with the unions
in their respective undertakings with regard to the finali6ation of the terms of the long
term settlement of wage structures, resulting in stalemate in negotiations and
conse&uent impasse$ I% $he h"#$or of 7 #+cce##"-e ("&ar$"$e #e$$leme%$# "% $he
(a%)"%g "%!+#$r, I3A ha# %e-er e8erc"#e! $he"r "%!e&e%!e%$ &o'er a%! '"ll $o
co%ce!e $o $he mer"$or"o+# log"cal arg+me%$# #o $he +%"o%# > ha-e of$e% &lea!e!
hel&le##%e## "% $he %ego$"a$"%g $a(le ? (+$ ha-e ac$e! a# &er $he !"c$a$e# ; $he
!"rec$"-e# of $he F"%a%ce 2"%"#$r e-e% o% %o% f"%a%c"al ma$$er#1 Therefore #o
calle! "%!e&e%!e%ce (e#$o'e! o% (a%)# 4 I3A "% !ec"!"%g HR &ol"c"e#
("la$erall '"$h $he +%"o%# a# &er $ra!"$"o%# are mere rhe$or"c or a&&ella$"o%# "%
a 2"%"#$erC# #&eech, "% #"m&le $erm# (e calle! a# hoa8$
%n the occasion of their =olden @ubilee in the year 19MD the *mployer-s
%rgani6ations in #ndia issued a statement of 2age ,olicy and +tructure, for which my
comments are as under:
The 2age ,olicy statement tried to feed the public with falsehoods and worn out
theories exploded long back$ #t is of course baseless and contrary to facts that Hvocal
and organi6ed groups have successfully secured larger share for their members from
the national product$ The 2ages ,olicy statement continues to harp on the anti&uated,
worn out and long exploded fallacy of the wage price spiral theory which is
denounced even by conservative trade unions all over the world as an antic designed
to put down the real wages$
The employers, in the name of a Hmeaningful wage policyI, wants to do away with
the system of sliding scale darkness allowance and the policy statement argues that
Hwages are an important ingredient of cost and therefore, automatic linkages between
price and wages make the inflationary process self propellingI$$
H(nother bugbear trotted out by the employers in season and out of season is the
system of bonus payment$ The policy statement also did not miss it, and repeated in
the same vein$ #t stated H#t is inconceivable that a concern which has incurred proved
losses has to pay a minimum bonus$ The net outcome has been closure of several
M8
mills or their unsatisfactory functioning H#n no case of closure, however, has it be
established that its cause is payment of bonus to its employees$ 5ut, even in the event
of profits of an establishment, the statement says, Hit would be patently wrong to
fritter away a large share of this to meet immediate consumption needsI$ Therefore,
the statement concludes Hconsidering all the aspect of the present bonus scheme it
seems that bonus should be abolished altogetherI$
Then what kind of a wage policy the employers wantY (ccording to them, there can
be no automatic compensation of the rise in the cost of living which in effect would
constantly erode the purchasing power of wages, bonus payment system should be
abolished altogether and there is nothing in the scheme of things drawn up by the
employers in the shape of a wage policy to determine wages taking into account even
the minimum needs of the workers$ The wage policy statement talks about Ha
meaningful wage policyI, which must subserve\ clearly defined national ob'ective
of securing higher rate of economic growthI, 2ill not lead to Hsectoral imbalancesI,
will not upset price stability, and that Hcapacity to pay is the fundamental ingredient
of a wage policy, and so on and so forth, a%! !oe# %o$ e-e% me%$"o% $ha$ 'age# are
mea%$ $o #a$"#f h+ma% %ee!# a%! $o ma"%$a"% a cer$a"% m"%"m+m #$a%!ar! of
l"-"%g "% $he g"-e% #"$+a$"o%1
7nderstandably, the main target of attack, both ideological and otherwise, of the
captains of industry and trade has invariably been the organised working class who
despite odds have been able to build up bargaining power unlike vast sections of
unorgani6ed workers who are denied even elementary rights and benefits$ (ll loud
talks and shedding of crocodile tears for the unorgani6ed workers for the well!being
of the community and for the national economy on the part of the employers, are
mere pretexts to counteract the demands of the organised workers, to weaken their
collective strength, to create ill feeling and enmity towards the organised workers and
thereby checkmate the latter-s- claims for higher wages, benefits and rights,
+imilarly, the right of collective bargaining has been sub'ected, more so lately, to all
kinds of battering and incurred the odium of the powers that be$ 3"g (+#"%e##
#&o)e#me% charac$er".e "$ a# LCoerc"-e (arga"%"%gM a%! &erha&# accor!"%g $o
$hem, ge%+"%e collec$"-e (arga"%"%g 'o+l! (e #"g%"%g o% !o$$e! l"%e# ( $he
+%"o%$
The drive to bring about host of amendments to the existing labour laws all aim at
establishing =overnment control over the trade unions and their activities at the
behest of the employers, to emasculate their role of defending and furthering the
interests of workers and to rob them of their fundamental rights$
The 2age ,olicy statement, however, refers to the international standards of wage
determination laid down by the #L% which of course contradict the criteria that are
conceded by the employers in their framework of a wage policy$ The
M.
recomme%!a$"o%# of $he 9orl! Em&lome%$ Co%fere%ce referre! $o "% $he
&ol"c #$a$eme%$, #$a$e# $ha$, $ha$ $he %a$"o%al 'age &ol"c of a mem(er #$a$e
#ho+l! (e #+ch $ha$ e%#+re m"%"m+m le-el# of l"-"%g a%! $he real 'age# of
'or)er# are &ro$ec$e! a%! &rogre##"-el "%crea#e!1
The wage policy adumbrated by the employers adds up to a policy of denial of proper
wages to workers, does not even mention need based norm of a minimum wage to
which they agreed along with the trade unions and the government in 19.J$ <o
wonder, such a totally anti worker wage policy if put into practice will be a constant
source of friction and conflict between labour and capital, and the greatest cause of
industrial disputes and strikers and strugglesI
<aturally we cannot ignore such irresponsible diatribes against our 'ust demands$ 2e
wish to answer to the spurious statistical 'ustifications in their wage policy statements
by these reviling critics in the words of ,rof Aaro% Ee-e%#$e"%! leading economist
who wrote in the syndicated newspaper column in <ovember 19.1 itself OS-#-!&-!+&
#(, '!2, # B!2!"! 1#-3!". &5!-4 :3#- -3,$ (,/,#' !& &5..,&-!/,= 15- 63#- -3,$ +)"+,#'
!& /!-#'@
#n this article an attempt is made to expose the reality and explode the myths about
the bank employees- present wages by presenting realistic bank employee-s budget
by replying to the falsehoods of Khigher!ups- mal! propaganda as under$ ?T3,(, #(,
-6) 2!"%& )* &-#-!&-!+&7 -3, 2!"% $)5 '))2 58 #"% -3, 2!"% $)5 0#2, 58I$ 0y
presentation is based on the statistics you look up in your monthly ,ay +lips$
?on-ble ,illars of #ndian +ociety
3evered +irs, Let me have the honour of presenting this 5udget in the interest of our
anxiety of having cordial relations with the sea of poverty$ There are only two
favoured sections in our society who en'oy the uni&ue position of being deported to
covetous #slands on =overnmental flats$ The 5ritish =overnment obliged the
freedom fighters like A$D$ +avarkar and 5hagat +ingh-s colleagues by deporting them
to (ndaman #sland$ +uch honour was bestowed on bank and insurance employees by
the =overnment of the #ndependent #ndia on the recommendations of the corridors of
power and ruling elite$ $ (s per their recommendations all bank and insurance
employees have been deported to the high wage #sland and since then all 0inisters
(of all hues), public figures, sheltered intellectuals, ,ress 5arons and K*xperts- of all
sorts have unhesitatingly lent their assistance in safe guarding the territorial integrity
of this covetous #sland, by raising very many barricades on Kwar footing-$
+ir, # have spent my forty two years- experience in constructing this 5udget$ # waited
for 8" years in giving Kfinal touches- to this 5udget but the disparity between
3eceipts and ,ayment disheartened me every time$
M
*mboldened by the Deficit 5udgets every year and unhampered expansion of +tate
=overnments- over drafts, # gathered enough raw courage to present this so called
?igh wage #slander-s 5udget$ # am extremely thankful to the learned leaders of our
society for making me realise that Deficit 5udgets are part of our life, like ?igh or
low blood pressures and diabetes and that # have to live with it HboldlyI, preferably
by blaming others, such vituperations will serve as palliatives and tran&uilisers$ (ll
existing =overnments have blamed the previous =overnments, such periodic
outbursts have helped me in restructuring our value pattern$ +tructural changes for
self!reliant economy can wait but structural changes in our values must by made on
war footing$
+irs, # am also extremely thankful to those who inspired me in drawing this 5udget
with their 5rilliant ideas of 0althusian 0adness and >eynsian methods of
postponing the crises, without their help, no sensible man can draw 5udgets$
,3*L#0#<(3G 3*0(3>+:
1$ The basis of this ?igh 2age #slander-s is the #slander who completed
his 10 years of service who gets highest increment called us hump
increment of 3s$1D00 in running scales of pay of "0 stages and
thereafter stagnation on this covetous #sland$ +uch an #slander is not
generally subsidi6ed by his parents from the H+ea of ,overtyI and
whose family components have sufficiently grown up to voice their
demands relying on the Kexperts- of the society$
"$ There are mainly two items of subsides:
b) The #slanders have an inalienable 3ight to marry any one from the +ea of
,overty$ +uch income coming from the +ea of ,overty in the form of wife-s
or husband-s salary need not be considered separately in view of the fact that
such subsidies are offset by the social overheads such as taking care of
children while both husband and wife are at work$ They also incur
exhorbitant expenses on monitoring the studies of their children$ 0oreover
the pattern of their savings (or absence of savings) convinced me that they
can be taken at par with the bread winning #slanders$
c) %vertime (llowance: (s per ministerial declarations$ %$T is banned and is
excised in his lexicon though it exists on paper in bipartite settlement in
vogue which is now consigned to historical archives$
MJ
<$5$ +ince there is no chance of full neutrali6ation of liabilities, # transferred
these liabilities to the =eneral Liabilities (ccount, in view of stoppage of
overtime on the #sland$
3evered +irs, # am fully aware that there are very many constraints on my
compilation due to correct statistical information$ 5ut if +imla 5ureau can construct
the #ndex <umbers for our D$($ without statistical information and the =ovt$ of
#ndia, when under the +tewardship expert, economic advisors could come to the
conclusion of allotting 0$M consumption 7nit to wife, without any rational basis, +ir, #
feel my methods of compilation are commensurate with the =eneral ethos of the
land$
3eceipts and ,ayments at a glance:
SR E C E I P T S P A G 2 E N T S
5asic +alary 3s$1M.00 =rocer-s 5ill for
: 3s$ ..0$00
( persons ) (aged mother B
father, spouse , widowed sister,
"children)
3s$.000
D$( 3s$19J"1 *lectricity Charges 3s$D8.0
?$3$ ( 3s$19". 0ilk 3s$1"D.
C$ C ( <$( 3ationing 3s$"8J0
,,(P1,( 3s$".0 <ewspapers 3s$"10
Conveyance
allowance
3s$"J. 1ees
+2% 45 3s$.00 0aid +ervant 3s$1000
+chool fees P tuition class fees 3s$D000
Cable charges 3s$.00
To$al R#1=//F/ R#/=:75
Q based on the pa" slip of member for the month .ugust 7589#
Less: +tandard Deductions
Component$ #n 3s$
MM
,$1 19".
,rofessional tax "00
+ocial benefit scheme (to be paid to family of
deceased on death in harness)
180
7nion fees 100
#ncome tax 1.00
Credit society loan J1."
1estival advance (in lieu of 5onus) DM00
<+C loan 1000
,rovident fund loan 1"J0
+taff housing loan 8DDD
(dditional staff housing loan (on enhancement
in &uantum for repairs and renovations,
additions)
8D8
L#C 1DD
+taff club .0
To$al 2F=<F
<et +alary 3s$ "08
(dd 0in$
a) Conveyance for all family members 3s$ D000$00
b) %ut of ,ocket exp$ of Children 3s$ 00$00
c) *ntertainment expenses <$(
d) +ocial obligation <$(
e) *xpenses of 5ooks B ,eriodicals for enlightenment <$(
f) *xpenses on clothes B footwear <$(
g) *xpenses on 0edicines beyond 0$(id <$(
h) ,ayment of installment on loan for dowries, <$(
0!80 basis in addition to ?ousing loan granted to *mployees$
3evered +irs, >indly note that the accommodations are not available without
payment of on money (which the =overnment of #ndia tried to attract) and the
employer does not pay for this money$
<$($ 1igure not available
# have not reconciled total deficit because of variable factors and # propose to leave
the calculation of the total deficit on the imagination and conscience of the ?on-ble
pillars of the +ociety$
M9
# respectfully beg pardon of all my colleagues for having disturbed their +ocial
prestige, but # am confident that at least by now our colleagues must have realised the
Truth in this +ocial systemD Cre!"$ 'or$h"%e## "# a##e##e! o% l"a("l"$"e#, a# "$
re&re#e%$# #oc"e$C# fa"$h "% $he &er#o%
E%! %o$e $o (a%) em&loee#: it is true that we get automatic increase in D$( every
&uarter when price go up$ 5ut it is also a fact that purchasing power crashes with the
speed of rocket$ The condition of the pay packet getting empty too soon is what the
economists call Kinflation- 4 rather a contradiction in terms, since what you
experience, in fact, is the very opposite deflation$ 2e need not &uarrel with the
economists over the coining of the word since we have other things more important
to &uarrel about$ (nd that &uarrel is that when the capacity of the pay pocket to
stretch gets rather shrunk, the si6e of the shrinking should be seen in the rise in the
cost of living index (or the consumer price index) but invariably both do not totally$
That is, when you can live without a loan till the D0
th
of the month under ordinary
circumstances and on a given standard of subsistence (as the appropriate pay
commissions or tribunals have condescended to fix) and the experience is repeated in
subse&uent months, the cost of living index will remain constant$ 5ut when the loan
becomes immediate on the "0 the subse&uent month, it means your purchasing power
is reduced by one!third and this should be seen in the rise in the cost of living index
by DD$D per cent 5ut when that rise is not even shown as three per cent let alone DD$D
per cent you have a right to be indignant with the economists and statisticians$ ?ence
1or all us first week happens to be &a&er 'ee) and last week &a+&er 'ee)$ #n
between we raise loan, once again raise loan to repay old, outstanding loans$ This
"rre-oca(le le$$er of !e("$ continues till we retire1 (nd when we retire the measly
superannuation benefits are not enough to tide over of miseries of retired life$ This
is reality and plight of a bank employee which he or she covers under the facade of
false illusions and petty middle class notions$
I$ "# a &"$ a# #er-"%g em&loee# are (e"%g !e%"e! &ar"$ '"$h Ce%$ral
5o-er%me%$ Em&loee# <
$h
&a comm"##"o%C# #cale#1 A%! re$"re! em&loee# are
!e%"e! +&!a$"o% a$ &ar 9"$h Ce%$ral 5o-er%me%$ Em&loee# a# &er $he < &a
comm"##"o%1 I# $h"# %o$ m"#carr"age of 6+#$"ce $o all of +#W
Go+ Are @al+a(le
. well !nown spea!er started off his seminar b" holding up a 0s#355 bill# In the room
of 755, he as!ed, O'ho would li!e this 0s#355 notePO
@ands started going up#
@e said, OI am going to give this 0s#355 to one of "ou but first, let me do this#O @e
proceeded to crumple the dollar bill up#
@e then as!ed, O'ho still wants itPO
90
till the hands were up in the air#
O'ell,O he replied, O'hat if I do thisPO .nd he dropped it on the ground and started
to grind it into the floor with his shoe#
@e pic!ed it up, now all crumpled and dirt"# ONow who still wants itPO till the hands
went into the air#
O6" friends, "ou have all learned a ver" valuable lesson# No matter what I did to the
mone", "ou still wanted it because it did not decrease in value# It was still worth
0s#355#
6an" times in our lives, we are dropped, crumpled, and ground into the dirt b" the
decisions we ma!e and the circumstances that come our wa"#
'e feel as though we are worthless# 1ut no matter what has happened or what will
happen, "ou will never lose "our value$
Go+ are #&ec"al ; Do%P$ e-er forge$ "$
Therefore ha-e #elf (el"ef "% o+r a("l"$ a%! ca&ac"$ $ha$ o+ ca% ma)e $h"%g#
ha&&e% aga"%#$ all o!!#1 %n you depends everything in the 7nion, for history is a
process of evolution of human thought and consciousness$ #t is not made to order$ 2e
contain in ourselves a well of creative forces$ #t is a spring which never dries up$ The
more we draw from it, the more we feel energi6ed, elated and exhilarated$ #t is the
correct combination of the creative process which spring from the well of thought and
consciousness that p0ushes the human story to cresends of glory and achievements$ #f
we are static everything remains static$ 3emember` That we are architects of our own
destiny$ Let us grapple the horns of history, shake it, and shape our future by 7nleashing
propaganda against forces ganged up unison to deny our 'ust wage revision by
explaining correct facts and truths$ The ob'ect of this series of articles giving
'ustifications of our demand is to disengage truth form false hood for truth is beautiful
and truth triumphs always $
3emember friends: wages or privileges we get today are not charity of #5(P=ovt$ #t
is the heritage and legacy of our sustained struggles and inspiring sacrifices
D#(, -) &-(5..',= D#(, -) 6!" in pursuance of sacrosanct demand hike of "./ in pay
slip component$
CHAPTER 6 VI
JUSTIFICATION @ID OUR DE2AND IS REASONA3EE AND ACHIE@A3EE
91
The concept of ,ublic +ector$, it is by now common knowledge was promoted in
#ndia at the behest of the captains of #ndian ,rivate +ector as early as in 1988$ ,rivate
sector #ndustrialists including @3D Tata were involved in drafting the 1988!5ombay
,lan- detailing the need for creating a ,ublic +ector$ ,rivate +ector industries needed
cheap infrastructure like power, railways and roads$ They needed subsidi6ed raw
materials$ They were neither willing nor had the financial resources of such massive
scales to invest in long!gestation periods
The #ndian ,ublic +ector, however, along with all that cheap economic infrastructure
also generated a demographic revolution not unlike in erstwhile +oviet 7nion after
the 191J revolution$ 2ith secure 'obs came several generations of children of free
#ndia 4 who grew up in relative affluence 4 with sturdy health, steady homes and
educational opportunities unknown before creating the new world renowned
technical manpower of #ndia 4 the third largest in the world$ Thus the =reat middle
class of #ndia which included bank employees became an #nternational force to
reckon with$
They have transformed a backward country into a modern nation threatening to upset
the hegemonic ambitions of super powers and imperialist forces$
,itching for consolidation in the banking industry, former 1inance 0inister ,
Chidambaram said #ndia would need one or two global!si6e banks as it marches
ahead to become the worldEs third largest economy at the 5ancon!"0/2 rece%$l a$
P+%e o% 2= No-em(er 20/=1MF"%!"%g %e' (+#"%e## mo!el# '"ll "%e-"$a(l lea! $o
#ome co%#ol"!a$"o% 111 9e m+#$ crea$e a$ lea#$ 2 or : 'orl! #".e (a%)#1 Ch"%a ha#
!o%e "$1 F2e should not fear consolidation$ # know there is pride and identity, but
ultimately some consolidation would have to take place in the banking system in this
country,F he said$I (nd if #ndia wants to be $$$ and it will be the third largest economy
in the world $$$ we must also have one or two world si6e banks and some
consolidation is inevitable,F he said at 5ancon!"01" meet , disregarding historical
facts and comparison on the other important factors which led to nationali6ation of
banks in china such prevalent wages in banking industry in china $3eports confirm
that The salaries and bonuses expenditure of bank employees in china increased
from 19$9 billion to D$""" billion Guan, an increase of "/between "100!$The high
profits and high salaries on offer at Chinese banks have been brought into &uestion as
the countryEs economy begins to slow, with senior executives now earning as much as
M0 times the salary of a general employee$
2hen it comes to historical facts it should be understood contrary to popular
perceptions, U%l")e Ch"%a o%l o% J+l /7, /7<7, >22 ear# af$er "%!e&e%!e%ce?
fo+r$ee% ma6or (a%)# of $he co+%$r 'ere %a$"o%al".e! !e#&"$e 3a%)"%g
!e$erm"%"%g $he (ac)(o%e of $he eco%om1
9"
3a%) Na$"o%al"#a$"o% ;
The #mperial 5ank merely changed its name to the +tate 5ank of #ndia V+5#W by the
+tate 5ank of #ndia (ct 19."$ #n 19.D the ,alai Central bank collapsed$ ( similar fate
faced most of the banks run by the erstwhile mahara'as, due to the large funds
siphoned off$ To save these banks from default and to bail out the mahara'as, 10
banks belonging to the princely state were taken over by +5# in 19. 4 these
included the +tate 5ank of ,atiala, +aurashtra, 5ikaner, @aipur, #ndore, 5aroda,
0ysore, ?yderabad, Travancore and a number of smaller ones like +angli, manipur,
0ayurban', etc$
#n 19.9 ,alai Central 5ank Ltd, >erala which had reportedl" financed some
assembl" J parliament elections went into liquidation$ #t was followed by failure of
Lakshmi 5ank Ltd (kola, in the next year $The list of such banks before
<ationali6ation will be to big too be named here$
#n the late 19.0s the government appointed the 0ahalanobis Committee to look into
the precarious conditions of the private 5anks$ The 0ahalanobis 3eport,
recommended besides handing out the standard formulae $o re!+ce fla(, $r"m #".e,
e$c1, "$ #+gge#$e! $he amalgama$"o% of $he le## &rof"$ ma)"%g (a%)# '"$h $he
o$her#$ This resulted in the number of banks being reduced from <05 "% /750O $o =2:
"% /75<O $o 272 "% /7</, $o /02 "% /7<< a%! o% $he e-e of %a$"o%al"#a"o% "% /7<7,
$o 6+#$ H<1
#n the late 19.0s the government appointed the 0ahalanobis Committee to look into
the precarious conditions of the private 5anks$ The 0ahalanobs 3eport,
recommended besides handing out the standard formulae $o re!+ce fla(, $r"m #".e,
e$c1, "$ #+gge#$e! $he amalgama$"o% of $he le## &rof"$ ma)"%g (a%)# '"$h $he
o$her#$ This resulted in the number of banks being reduced from <05 "% /750O $o =2:
"% /75<O $o 272 "% /7</, $o /02 "% /7<< a%! o% $he e-e of %a$"o%al"#a"o% "% /7<7,
$o 6+#$ H<1
0ost of these banks that had existed were the offshoots of local landlordsP0ahara'as
or big traders and moneylenders who sought to extend the scope of their financial
activities$ 0ost were in a state of collapse, due to irregularities and the take!overs by
the +5# and mergers saved them from default of depositor-s monies$ 5esides, in the
new scenario, after 198J, the big bourgeoisie who became the dominating partner in
the ruling class alliance could not allow the fiscal anarchy profligacy of the
moneylender P landlord P trader combine and had to bring system into finance and
banking to tap resources to the maximum$ 1ollowing the recommendations of the
3ural 5anking *n&uiry Committee, the then #mperial 5ank of #ndia was asked to
open 118 new branches in rural and semi!urban areas within a period of . years from
9D
1$J$19.1 to D0$.$19..$ %nly D branches were opened by it$ Credit disbursed to the
rural areas was practically nil$

#n the aforesaid background and on the recommendations of (ll #ndia 3ural Credit
+urvey Committee, +tate 5ank of #ndia (ct was enacted in 19.., transferring the
#mperial 5ank of #ndia to +tate 5ank of #ndia$ 3eserve 5ank of #ndia contributed
nearly 9J/ of the e&uity of +5#$ 2ithin a period of . years from its inception, +5#
opened 81. branches as against a target of 800 branches given to it$ ,ursuant to the
same ob'ective +5# (+ubsidiary 5anks) (ct was passed in 19.9, which enabled the
+5# to take over associate banks as its subsidiaries$ Thus, the period of 19.. to 19.9
marked the beginning of public sector banking$

The afore#a"! #$e&# &ro-"!e! a f"ll"& $o &ro-"#"o%# of cre!"$ $o r+ral #ec$or a%!
al#o $he e8&a%#"o% of (a%) (ra%che#1 Th"# force! $he 5o-er%me%$ $o "%$ro!+ce
$he #cheme of L#oc"al co%$rolM "% /7<H1
That is why, "8 insurance companies were also taken over in 19., with the
formation of the L#C$ (nd to organise fiscal controls more tightly as per the goals set
by the Tata!5irla 5ombay ,lan, <ationalisation of the 18 ma'or banks become a
necessity$ A%ho', "f %o$ %a$"o%al".e!, ma% of $he &r"-a$e (a%)# 'o+l! ha-e
colla&#e!$ The 18 ma'or banks nationalised out of the existing M banks, controlled
M./ of banking in #ndia$ #n 19M0 another banks were nationalised to save them
from collapse$
5ig business re&uired massive investments in infrastructure if it was to grow$ Lack of
infrastructure and capital was leading to stagnation and decline$ Na$"o%al"#a$"o% a%!
$he e8&a%#"o% of (a%)"%g, 'a# a %ece##ar fac$or, $o ##$ema$"call $a& $he
&eo&leC# #a-"%g# "% or!er $o ge%era$e $he %ece##ar ca&"$al1 The rural sector faced
an agrarian crisis$ The widespread famine in 19J found the rulers panic!stricken
The ,L!8M0 grain doles, had, by now got thoroughly discredited (n alternative had
to be found$ The GGreen 0evolutionH was their answer to stem off peasant uprisings
which gained acceptance and momentum among the progressive sections of the
population$ There were three basic elements in the method of the =reen 3evolution:
1$ Continued expansion of farming areasO
"$ Double!cropping existing farmlandO
D$ 7sing seeds with improved genetic
The initiation of the =reen 3evolution re&uired certain amounts of seed capital, given
on a concessional (even free) basis to farmers, to encourage them to turn to the ?GA
varieties$ S+ch ca&"$al a%! '"!e#&rea! !"#(+r#eme%$ co+l! (e#$ (e ach"e-e!
$hro+gh %a$"o%al".e! (a%)"%g1 A -a#$ %e$'or) of r+ral (a%)"%g 'a# %ee!e! $o
98
(e #e$ +&, f"r#$ $o &romo$e $he gree% re-ol+$"o%O #eco%! $o $a& $he #+r&l+#
crea$e! $o cha%%el "$ "%$o #a-"%g# for +#e ( go-er%me%$4("g (+#"%e## for
"%fra#$r+c$+ral !e-elo&me%$1 3e#"!e#, l"%)e! $o $h"#, $he foc+# for r+ral
!e-elo&me%$ cha%ge!1111 from a##e$ ge%era$"o% $o &o-er$ alle-"a$"o%1 This
coincided with #ndira =andhi-s slogan of GGaribi @ataoH
9h Pr"-a$"#a$"o%W
#n the period of globalisation and increasing domination of international finance
capital, the model of development and the focus for market expansion is the top 10/
of the population$ +o all economic policy is aimed at hitting hard the bottom M0 to
90/, in order to fatten the top 10/$ +o subsidy cuts, disbandment of ,D+, drastic
reduction in welfare measures, etc$ are geared to push the mass into even further
destitution, and utili6e those funds to subsidies P promote big business, T<C-s
interest, infrastructure development etc$
#n addition, the green revolution is in crisis and the banking structures that
accompanied them are not longer re&uired$ 5esides, foreign agri!business plans to
enter straight into the agricultural sector$ 1inally, the bulk of the poverty alleviation
schemes are being wound up or reduced to nominal levels in regions$ +o the banking
structures that accompanied it are no longer re&uired$ 1inally, the tapping of people-s
savings will be restricted, due to mass impoverisationO and the 10/ that will be able
to invest their savings will be serviced by private and foreign banks, with higher
service charges$
+ome of the liberalisers argue that we need to infuse the blood of dynamic foreign
banks into the #ndian banking industry1
+ome time in @anuary"00. the 1inance 0inister called the Chairmen of the public
sector banks and told them that they must immediately act to merge their banks and
reduce the number of public sector banks to 'ust four$ (lso they were told to write off
their <,(s (<on!performing (ssetsO or money loaned to big business and not paid
back) fast$ The entire purpose was to make the banks viable for foreign take!over$
(long with the rethink on the &uestion of 1D# in banking, the government has been
emphasi6ing the need for consolidation of #ndian banks The need to compete
effectively with world class banks asserted in the 1inance 0inister-s speech cannot
possibly refer to operations in overseas markets, since the #ndian banks are still too
small both in terms of si6e and range of operations and products necessary to
compete internationally$ 2hat perhaps the profitable #ndian banks could at most hope
for in the near future is to service the #ndian diaspora and the international operations
of #ndian corporates$ The talk of taking on the global ma'ors is therefore arguably on
#ndian soil where the government is adopting a paradoxical policy of, on the one
hand, pushing for consolidation of ,+5s for fear of competition from world!class
9.
banks, while simultaneously soliciting more 1D# into banking$ The go-er%me%$C#
fear $ha$ "%$er%a$"o%al (a%)# co+l! o+$;com&e$e !ome#$"c (a%)# a%! +l$"ma$el
$a)e co%$rol of eco%om;'"!e (a%)"%g a##e$# "# real1 3+$ &rec"#el for $he#e
rea#o%# $here "# %ee! $o re#$r"c$ a%! !"#co+rage (a%)"%g FDI1
S)= -3, 8(!/#-!&#-!)" )* 1#"2& !& ",+,&&#($ #&8,+- )* -3, )".)!". .')1#'!&#-!)" )*
-3,!( ,+)")0$4 I- 6!'' (,&5'- !" 0#&&!/, (,-(,"+30,"- )* &-#**4 S!4,4= #.(!+5'-5(,=
3#"%!+(#*-& #"% &0#'' &+#', &,+-)( 85--!". -3, /#&- %)0,&-!+ &#/!".& #- -3, &,(/!+,
)* TNC&= +')&5(, )* R")"-/!#1',> 1(#"+3,& #"% -3()6!". !"-,(,&- (#-,& -) -3,
/#.#(!,& )* -3, 0#(2,-4
B5- !- !& # !((,*5-#1', *#+- -3#- S"%ce /7<7, 'e ha-e (ee% '"$%e##e! FF 3a%)
merger# a%! ac*+"#"$"o%#, ma"%l (eca+#e of $he fa"l+re of &r"-a$e #ec$or
(a%)# 1ma"%l !+e $o 2erger# a%! ac*+"#"$"o%# 'ere !o%e "% &+(l"c "%$ere#$ a%!
$o #a-e !e&o#"$or#1 2o#$ of $he &r"-a$e Sec$or (a%)#, 'h"ch co+l! %o$ #+r-"-e,
'ere (a"le! o+$ ( P+(l"c #ec$or 3a%)#
So "$ (ecome# e-"!e%$l clear o%e of $he h"!!e% "$em# of age%!a of $he &r"-a$"#er#
>f+ll #+&&or$e! ( $he recomme%!a$"o%# of $he $'o Nara#"mham Comm"$$ee#?
"# $o clea% +& $he (ala%ce #hee$# of $he PS3# a%! ma)e $hem rea! for a
$a)eo-er1 2erger# 'o+l! ma)e $hem more a$$rac$"-e for $he #har)# roam"%g
aro+%! $he glo(al f"%a%c"al #ea#1
(ny reforms of the banking system should be built on the institutional structure that
has created it rather than seek to destroy it as is now being done$
The banking industry is in need of true reforms in pursuit of true nationali6ation, but
the strategy for it does not have to subvert the basic goals of development nor does it
have to be forced at a pace that will result in li&uidation of the institutional structure
built up over decades of faith$
Today efficiency and profitability has become the catchwords$ #t was thought that
perhaps such wholesome overhauling, will be impossible for #ndian banking industry
to withstand and that it will finally give in and make room for the foreign giants in
this field$ Thanks to the inbuilt resilience of our banking system the banking industry
has come out victorious$ #t could avert the crisis that often follows the reform
process$ To fall "% l"%e '"$h glo(al #$a%!ar!#, nationali6ed banks also adopted
,rudential accounting norms, #ncome recognition and (sset Classification and
became strong and healthy$ (part from undertaking the +ocial 5anking, the ,ublic
+ector 5anks are e&ually competitive at #nternational 5anking landscape$
9
P+(l"c Sec$or 3a%)# o&era$e "% a !"#c"&l"%e! ma%%er ( o(#er-"%g com&l"a%ce of
reg+la$or re*+"reme%$# a%! "% fac$ "$ 'a# (eca+#e of $h"# $ha$ $he I%!"a% (a%)#
ha-e emerge! rela$"-el +%harme! from $he rece%$ glo(al f"%a%c"al cr"#"#1
T3, 6)(20," #"% )**!+,( ,08')$,,& )* 1#"2!". &,+-)( 3#/, #+-!/,'$ !"/)'/,% !"
"#-!)" 15!'%!". 1$ ,**,+-!/,'$ !08',0,"-!". "#-!)"#' #.,"%# )* ,08')$0,"-
+(,#-!)" #"% ,+)")0!+ N I"%5&-(!#' .()6-3 #"% ,"<)$ ')- )* (,&8,+- #"% 8)85'#(!-$
8#(-!+5'#('$ !" R5(#' N S,0! U(1#" #(,#&
2hile the efficiency of the banking operation leaves much to be desired, what has
been achieved has been unparalleled spread of bank branches and generation of
employment, which has made tremendous difference to the rural and urban economic
activity$
(ny reforms of the banking system should be built on the institutional structure that
has created it rather than seek to destroy it as is now being done$
The banking industry is in need of true reforms in pursuit of true nationali6ation, but
the strategy for it does not have to subvert the basic goals of development nor does it
have to be forced at a pace that will result in li&uidation of the institutional structure
built up over decades of faith$
+ince 199, we have been witnessing JJ 5ank mergers and ac&uisitions, mainly
because of the failure of private sector banks as &uoted in the earlier paragraphs of
this report$ 0ergers and ac&uisitions were done in public interest and to save
depositors$ 0ost of the private +ector banks, which could not survive, were bailed
out by ,ublic sector 5anks
That is why in #ndia!we re'ect!and totally re'ect any discussion about the ,ublic
+ector only in terms of their profitability!inspite of the fact that they are indeed far
more profitable than the private sector$
2here did the <arasimham report come from$ #t is a Zerox copy of the #01
conditionalities$ (ll the T<Cs and 0<Cs of the advanced nations in general and
(merica in particular$
2e know the names of the foreign banks taking away the cream of business from the
,ublic +ector banks$ 2e know the new names of Cold Drinks, potato wafers, soaps
and soap operas, cars and white goods, television and stereos, mobile phones and
hotels, ice creams and footwear$ The list is long$ They are already everywhere$ <ot
only will such a step further infringe on the sovereignty of the country, but will have
a disastrous impact on the lives of the people$ 5ut the rulers of our country, acting as
9J
the most vile agents of the foreign powers, are pushing through this Kreform- at break!
neck speed$ They will get bou&uets from the super powers, but brickbats from the
masses of #ndia$
9e are %o$ "%$ere#$e! "% $he"r Bo% l"%e offe%ce# aga"%#$ o+r #$r+c$+re! 'age
#$r+c$+re#1 9e )%o' $he are %o$ "%$ere#$e! "% e-e% o%e !aC# ho%e#$ la(o+r I
$he 'a%$ $o lea-e "$ $o +#1
9e )%o' $ha$ $he ca%%o$ affor! $o clo#e !o'% $he &+(l"c #ec$or (a%)# "% r+ral
area# a%! %o% &rof"$a(le ce%$er#1 The are o%l "%$ere#$e! "% $he cream "% $he
c"$"e# a%! &rof"$ ce%$er# l")e $he"r ca$# 'arm"%g "$#elf "%#"!e "% $he f"re &lace
'h"le 'e #log o+$#"!e a%! g+ar! $he co+%$r l")e loal !og#1
Let them not however think that the great working people of this country, the great
middle class of this country, don-t know what is going on$ #t is not incidental that the
working people of this country, the great middle class of this country don-t know
what is going on\#t is not incidental that the working people of this country strike in
a telling manner whenever there is an election$$$ no wonder they are willing to make
any kind of an alliance to avoid elections$ They know, alright, that we do know$
QFINANCIAE REFOR2SM, BNPACS J SCA2S ARE EIKE AN O3JECT AND
ITS SHADO9S! DENGIN5 JUST 9A5E RE@ISIONS
The way the politicians, bureaucrats and private parties, industrialists bleeded the
public sector banks$, appropriated its resources and generally used it for building
their regime of patronage system is also well known across the country and needs no
detailing$ The industrialists and ruling elite always skimmed off the entire cream of
public sector profits for their own private consumption resulting in burgeoning <,(-s
and conse&uent higher provisioning depressing profits and our share of wages$
They have collected the returns, reaped the profits and generally demoralised the
morale$ The ,ublic +ector has survived inspite of them and because of the dogged
determination of the working people of the country to preserve their 'obs, security,
dignity and future$ (s far as the ,ublic +ector banks 4 from the infamous <agarvala
to the e&ually flamboyant ?arshad 0ehta, >etan ,arekh 4 scams are only increasing
in their volume and audacity every day compelling banks to cushion higher
provisioning and conse&uent depletion of profits and share of 'ust wages$
*conomic Times 5ureau recently on @un 10, "018,reprted that J+#$ f"-e of $he 2F
go-er%me%$ o'%e! (a%)# &re#e%$l ha-e %e$ %o%;&erform"%g a##e$# (elo' 2%,
he &o"%$e! o+$1 The !e-elo&me%$ "# #"g%"f"ca%$ a# $he I%!"a% eco%omP# gro'$h
#l"&&e! from =17<% "% 20/2;/: $o =1F% "% 20/:;/=, lea!"%g $o a :<% #+rge "%
gro## NPA# re&or$e! ( (a%)# "% $he &er"o!1 3 2arch 20/=, gro## NPA# "%
(a%)# #$oo! a$ %earl R# 21= la)h crore
9M
)n *ri(ay+ ,uly -+ 2013+ al!o%t all t'e lea(ing new% "a"er% re"orte(
t'at .rite )ff IS $ore /'an 0eal 0ecovery of Ba( 1oan% in Ban%
Public sector banks are writing off more loans than they recover, despite
repeated advisories from the finance ministry. In the fourth quarter of the
last financial year, of the 26 staterun lenders, as many as !" banks had
written off more loans than they recovered.
2/'e write3off by t'e%e 14 ban% in t'e ,anuary3$arc' 5uarter of
2012313 wa% 'ig'er t'an t'e write3off by all t'e 26 "ublic %ector
ban% in 20113126Accor(ing to (ata co!"ile( by t'e finance
!ini%try+ 14 "ublic %ector ban%+ inclu(ing big len(er% lie State
Ban of In(ia+ Ban of Baro(a an( Pun7ab National Ban+ 'a(
written off loan% wort' 0% 10+444 crore in ,anuary3$arc' 5uarter+
w'ile t'e recovery wa% 0% 8+142 crore (uring t'i% "erio(6 9uring
2011312+ "ublic %ector ban% wrote off loan% wort' 0% 2+300 crore+
w'ile t'e recovery wa% 0% 84+:00 crore6 /'e i%%ue 'a% alar!e( t'e
finance !ini%try+ w'ic' in a note to t'e ban%+ 'ig'lig'te( t'e
"ractice an( re!in(e( t'e! t'e i%%ue wa% rai%e( a% early a% ,uly
2006 an( wa% reiterate( in $arc' t'i% year6 /'e i%%ue wa% rai%e(
(uring a !eeting of baner% wit' for!er *inance $ini%ter P
C'i(a!bara!6 # loan i% written off after !aing 100 "er cent
"rovi%ion+ w'ic' 'it% ban;% "rofitability6 <owever+ t'i% al%o 'el"%
ban% to %'ow lower gro%% NPA%6 Ban%+ "articularly t'e
govern!ent3run one%+ are facing 'ea(win(% a% far a% a%%et 5uality
i% concerne( a!i( econo!ic %low(own6 Not only gro%% an( net
NPA% of "ublic %ector ban% are 'ig'er t'an t'at of t'eir "rivate
%ector counter"art% but t'e%e ban% al%o %'are 'ig'er bur(en on
re%tructure( loan%=6
(s per 3eport of the Central 5oard of Directors on the working of the 3eserve
bank of #ndia for the year ended @une D0, "01D submitted to the Central
=overnment in terms of +ection .D(") of the 3eserve 5ank of #ndia (ct, 19D8,
in scheduled commercial banks the 5ro## NPA $o 5ro## A!-a%ce# 'h"ch
217 "% 20/2 "%crea#e! $o :1=1 The Ne$ NPA $o Ne$ a!-a%ce# for $he #ame
&er"o! "%crea#e! form /12 $o /15$
The bad loans in ,+5s has increased from 3s D9,000 crore in 0arch "00M to
3s 1,8,000 crore in 0arch "01D and the bad loans restructured and shown as
good loans accounts to 3s D,".,000 crore$
99
%f the restructured loans, 3s ", J0,000 crore was in favour of corporate
borrowers$ #f we include the bad loans in the private banks and foreign banks
and other financial institutions, the total bad loans are more than 3s ",.0,000
crore
The provisions made for bad loans from the profits earned by the 5anks has
been growing and it has show a growth from 3s 11,1"1 crore in "00M!09 to 3s
8D,10" crore in "01"!1D, accounting to a total of 3s 1,80," crore as
provisioning in the five years$
( list of top .0 loan defaulters, mainly the corporate firms, whose total default
amount to the banks is allegedly to be around 3s 80,."M crore$
#n a period between "00M and "01D, the banksE gross profit before provisions
for bad loans was at 3s D,.M,M9D crore, of which the provisions made for bad
loans was 3s 1,80," crore leaving the banks with net profit of 3s ",1M,"J
crore$
0eanwhile, the provision coverage ratio has been falling, making the banks
more vulnerable and susceptible to risks against loan losses and as compared
to the provision coverage ratio of M per cent as on 0arch D1, "01", it has
reduced to " per cent by 0arch D1, "01D$
F(ccording to 35#, the ratio in the entire banking system has fallen from ..
per cent to 8. per cent while the global average ratio is J0 to M0 per cent
1ormer finance minister 0r$ Chidambaram accepted that at least "1. pro'ects
with investment of 3s J lakh crore have been delayed in the infrastructure
space$ 5anks have disbursed around 3s .8,000 crore loans towards these
stalled pro'ects$ %f the 1" new pro'ects worth 3s D$.. lakh crore, banks have
sanctioned 3s 8D,000 crore as loan
3eserve 5ank of #ndia (35#) Deputy =overnor > C Chakrabarty said banks
had written off 3s 1 lakh crore in the past 1D years and criticised the lenders
because as much as 9. per cent of these write!offs were for large borrowers$
HDuring the past 1D years what we see is that the banking system as a whole
has written off more than 3s 1 lakh crore in advances,I Chakrabarty, the
senior!most of the deputy governors at 35#, said$
100
?e said over 9. per cent of such write!offs have been observed in the case of
big accounts and expressed anguish that public discourse focuses only on the
government-s agricultural debt waiver scheme of "00M$
H2e only talk about the debt waiver of the agricultural borrowers, we donEt say
big players and of this (3s 1 lakh crore) 9. per cent are all big borrowers and it
has been written off,I he said$
?aving earned a gross profit of 3s$1,1","90 crores V"011!1"W, the present offer
of #5( is too meagre as against our minimum demand of "0/ on pay slip
components as explained in 'ustification 8 of this article with the stalemate
offer of #5( being 11/(3sD8.crores)our demand of "./ to be met is
( 3s$JMJ.crores ) , the cost analysis of demand is meagre M/ of the gross
profit $ (fter setting apart this negligible percentage from out of the profit
earned to the hard working bank employees, the balance can be diverted
towards providing bad debts and other purposes prescribed by the ?on-ble
1inance 0inister$ Do we not deserve a small share of profits to meet our
legitimate demand of reasonable compensationY 2hen the responsible reply
does not come forth, should we not conclude that the =overnment policy is
profiting the private by allowing the banks to decay through demoralising the
staffY
(dding fuel to fire, the statement of former 1inance 0inister in the meeting, at
the JMth foundation day of #ndian %verseas 5ank, painted a picture that the
entire profit earned are to be set apart for the wage increase for the 5ankmen
when public sector bank employees went on a two!day strike today seeking
'ust share wages $ 1inance 0inister ,$ Chidambaram said the profit of banks
cannot be used only to enhance salaries because there are other obligations$
The expressions of the former 10 is really unfortunate and a provocative one$
The banks, which refuse higher wages to its employees, waived bad loans of
big corporates causing severe loss to the banks$ 2hile the <,(s of big
corporates were ignored or waived, the small defaulters were made to suffer
with punitive action$ Then why are we being asked to participate in their
insincere crocodile tears for the efficiency and profitability of the ,ublic
+ector banks $especially when The productivity per employee, the business per
employee and branch and profitability of the public sector banks has enhanced
many folds$
F5ank loan write!off is an industry by itself$ The write!offs are very systematic
and scientific$ as socially conscious citi6ens we hold the view unanimous that
employees cannot be held responsible for the banksE bad loans$
101
(s per the data published by a leading employees union the <,( of top .0
corporate defaulters in this country is estimated to be R#1=0, 52H Crore1 E-e%
"f /71=:% "# reco-ere! "$ "# #+ff"c"e%$ $o mee$ o+r !ema%!#
(nd finally amount is #f the four defaulters of the country Vi$e$W >ingfisher
(irline (whom some banks have declared recently as wifuldefulter) 3s$"JD
crores, 2insome Diamond and @ewellery Co$, Ltd$, 3s$"0 crores,
*lectrotherm #ndia Ltd$, 3s$""11 crores and Soom Developers , Ltd$, 3s$1M10
crores amounting 3s$9D.8 crores would also suffice the minimum demand of
3s$ JMJ.cr as 'ust wage revision to the entire 5anking workforce$
5y initiating the following steps, we can easily find necessary resources to
meet all our 'ust demands, without costing the exche&uer$ There must be a time
bound action plan for enforcing them$
a) +trengthen the recovery tools and legal mechanisms, &uicken the process
time and cut down the delays$
b) 0ake the CD3, %T+ under Compromise route and 2riting off more
transparent, accessible to general public through voluntary disclosures and
get them covered under 3T#$
c) ,ublish the photographs of the defaulters in all national websites !
respective lending banksPfinancial institutions, 35#, C#5#L, 3ating
(gencies, +*5# and 0C($
d) +top lending further to the borrowersPinstitutions blacklisted$
e) 5eyond certain amount of 3eal (ccount Liability (say, 3s$10$00 Crores),
banks must be allowed to sell the properties mortgaged, after following due
process of law, without the intervention of courts and without even
resorting to action under +(31(*+# (ct$ 5ut, it must be ensured that
,rinciples of *&uity and ,rinciples of <atural @ustice are followed$
f) (de&uate incentives and compensation must be given to the banks for
lending under government schemes
g) #n case of massive loan waivers, banks must be compensated upfront (i$e$
funds must be provided beforehand to the banks
h) P+(l"#h $he l"#$ of (a%) loa% !efa+l$er# of R# / crore a%! a(o-e, ma)e
'"llf+l !efa+l$ of (a%) loa% a cr"m"%al offe%ce, or!er "%-e#$"ga$"o% $o
&ro(e %e8+# a%! coll+#"o%, ame%! reco-er la'# $o #&ee! +& reco-er
of (a! loa%# a%! $a)e #$r"%ge%$ mea#+re# $o reco-er (a! loa%#$
10"
i) Do not incentivise corporate delin&uency$
') Devise and =rant incentives tangible (cash) and intangible (fast track
promotions, soft postings etc$$$) to staff augmenting recoveries of <,($
Reform# Sho+l! 3e%ef"$ All
The %xford *nglish Dictionary has stamped its approval on the word by defining
FreformF as Fmake changes in (something, especially an institution or practice) in
order to improve itF$
#n recent times, another shade of meaning has got loaded onto the word: FreformF as
an action that lets market forces set the prices of goods and services as well as
interest rates$
Conversely, it means having the state play a lesser role in economic affairs$
Thus, Fbanking sector reformsF in #ndia have come to mean allowing more private
sector banks to set up shop and letting the market, not the 3eserve 5ank of #ndia, set
interest rates$ #n other words, it means giving banks more freedom to operate$
2hat is pu66ling, though, is that in the 7+ today Fbanking reformF has exactly the
opposite meaning to what it has in #ndia$ 2hen (merican media and policy makers
talk of Fbanking reformF, they mean putting more controls on banks$
1ormer ,rime 0inister #ndira =andhi was roundly condemned by the 7+ and other
2estern powers when she nationali6ed banks in our country in order to ensure that
credit reached the poor and powerless$ Deemed to be a socialist ! or communist!like
measure !, it has now been adopted without any &ualms by the avowed world leader
of free market economies$ #t seems the 7+ government had little choice, as otherwise
widespread mayhem may have resulted for the average citi6en both within 7+ and
abroad$ Clearly the rules of the game change for 2estern economies during crisis$
<ationali6ation can be resorted to when the (merican other developed nations
people need to be protected but the same measure can be decried when a developing
economy needs to do so to similarly protect its far more impoverished citi6enry$
Thus, the Fbanking reformF under way there currently, according to The 2all +treet
@ournal, will put Fnew heightened capital and leverage limitsF on big banks, Finstructs
the government to conduct unprecedented, ongoing audits of the central bankEs
lending programsF$
<ot only does FreformF mean different things in different countries, it may also mean
different things in the same country at different points of time$ 1or instance, Flabour
10D
reformsF in the 19.0s in #ndia generally meant giving workers the right to form
unions$
Today, however, they mean the opposite: giving employers greater flexibility in
hiring and firing workers$
#t is also useful to remember that a FreformF of one era could result in a situation that
re&uires FreformsF of another era to be undone$ 1or example, the general sentiment in
the 190s was that #ndian banks were too cosy with business groups that owned and
controlled them, and were not risk!taking enough in opening branches and lending to
new entrepreneurs$
These sentiments, in the course of time, led to the nationalisation in 199 of 18 of the
largest banks, which were then pushed to expand$ 5y 1990, deposits had increased
eightfold to 3s 1$1 lakh crore and the number of branches tenfold to 0,000$ 5ut this
heady expansion also created non!performing assets and hidden losses on their
balance sheets$ Aoila` The 1991 Fbanking reformsF recapitalised these banks, with the
government pumping money$
Gou can also set different standards for FreformF for yourself and for others$ Thus, the
stockbrokers on the 5ombay +tock *xchange are always in the forefront of calls for
Ffinancial reformF in the economy but resist Fstock exchange reformsF$ +o strong was
the brokersE resistance to, for example, computerisation that the government had to
set up a parallel stock exchange, the <ational +tock *xchange, to get it done$
The success or failure of reforms can also be invented$ #n their recent working paper,
FThe +ocial Construction of +uccessful 0arket 3eformsF, %xford 7niversity
sociologist David +tuckler and the co!authors say that the success of FreformsF and
the statistics to prove that they are successful are socially constructed by motivated
actors such as the bureaucrats in agencies that ran their programmes and players in
the financial services industries$ 1or instance, the extensive statistics published by the
*uropean 5ank for 3econstruction and Development (*53D) about the *ast
*uropean experience in the 1990s are the basis of the belief that large!scale
privatisation (RFreformsF) leads to rapid economic growth$ 5ut when the authors re!
examined the same data, Fthe positive growth effect of large!scale privatisation
disappears $$$ VsuggestingW that many cross!national studies using the *53DEs
statistics have potentially substantially overstated the links between neo!liberal
reforms and positive outcomesF$
The %e8$ $"me o+ hear a call for QreformQ, "$ m"gh$ (e +#ef+l $o a#), QFor
'ho#e (e%ef"$ "# $h"# reformWQ
The =uardian 5ritish national daily newspaper published on "J!"!"0" some startling
revelations with regard wages paid in public-s sector vis!a!vis private sector in 7$>$
108
H,ublic sector workers are more skilled, work shorter hours and earn more money
than their private sector counterparts, according to a new analysis of the differences
in pay out today$
5ut, if you have a degree, you will get paid better in the private sector ! and, for five
out of eleven years of data published by the %ffice for <ational +tatistics, the private
sector got better pay increases$
5ut, if you have a degree, you will get paid better in the private sector ! and, for five
out of eleven years of data published by the %ffice for <ational +tatistics, the private
sector got better pay increases$
The key facts are:
#n "011, public sector employees were paid on average between J$J/ and
M$J/ more than private sector employees
The public sector is made up of a higher proportion of higher skilled 'obs 4
widening over the last decade as lower skilled 'obs have been outsourced from
the public to the private sector$I
The public sector consists of a higher proportion of older employees and
earnings tend to increase with age and experience
+ource: http:PPwww$theguardian$comPnewsPdatablogP"01"PmarP"JPpublic!private!
sector!pay
2ith The main mantra L,= policies argued by protagonists and by successive
governments in power being global competitiveness, global brand, and global
standards$ etc$ # hope they may take leaf from this article and adopt similar
progressive wage structures in #ndian ,ublic +ector 4 described as temples of modern
#ndia by ,andit @awaharlal <ehru and to its employees$
These progressive thoughts were echoed by the former 3eserve 5ank of #ndia (35#)
governor D +ubbarao$ Concerned over low salary structure in ,+7 banks, he said
that in the absence of suitable compensation package they would lose talent to private
sector lenders$
HThe executive compensation in the public sector, as is well known, is lower than
that in the private sector$$$#f public sector banks are re&uired to compete with private
sector banks on a level playing field, there is a good case for compensating them too
on a competitive baseI, +ubbarao said a conference organi6ed by #5( and 1#CC#$
10.
HThere is a good reason to revise their (,+7 bank executives) compensatory
packages$$$There is also a risk that if the public sector bank compensation is not
improved, the public sector may lose talent to the private sector,I
+ource: ,T# ep 5L 7585
http:PPwww$livemint$comP,oliticsPAl2o6(hD&vm2sc3L*.yhm0P+ubbarao!for!
higher!salaries!to!chiefs!executives!of!,+7!ba$html
9h"le e%!or#"%g $he #+gge#$"o% $he go-er%or 'hole hear$e!l1 a log"cal corollar
o%e ca% !ra' "# $ha$ 3a%) em&loee# ca% leg"$"ma$el e8&ec$ $he #ame co%cer%#
$o (e#$o'e! o% $hem "% $he /0 ("&ar$"$e 'he% $al)# are afloa$ of "% ma)"%g
I%!"a% (a%)# com&e$"$"-e glo(all "% &+r#+"$ of "$# ra%)"%g '"$h "% $he f"r#$ /00
(a%)#1
1rom the forgoing the vital point that arise for consideration if we evaluate the wage
load purely in 3upees as per the trend followed in the previous bipartite settlements
to which my submission and answers inter!alia is as under
5ipartite at a glance of a'ar! #$aff only
A!!"$"o%al Per Ca&"$a E8&e%!"$+re o% 9age# >9or)me%?
D
rd
5,+ 3s$ 9.0 per annum
8
th
5,+ 3s$ ","00 per annum
.
th
5,+ 3s$ 8,1.0 per annum

th
5,+ 3s$ J,D90 per annum
J
th
5,+ 3s$ 1",..0 per annum
M
th
5,+ 3s$ "D,DD0 per annum
7
$h
3PS R#1 55,0F0 &er a%%+m
10
A%%+al 9age I%crea#e "% Pre-"o+# Se$$leme%$# >For 9or)me%?
Amo+%$ "% R#1 4 Crore#
D
rd
5,+ DD$00
8
th
5,+ 1"0$00
.
th
5,+ "J1$00

th
5,+ 8M"$00
J
th
5,+ M1M$00
M
th
5,+ 1"MM$00
7
$h
3PS 2,5FF100
No$eD This annual increase of R#1 2,5FF Crore# is in addition to the contribution by
the 5anks at R#1 =,200 Crore# (for existing ,1 %ptees) and 3s$ ",100 Crores (for
3etired ,1 %ptees) to enable them to 'oin the pension +cheme
Perce%$age A%%+al 9age I%crea#e "% Pre-"o+# Se$$leme%$# >For 9or)me%?
+ettlement 2age load in 3s$ #ncrease in 3s #ncrease in /
D
rd
1!M!J9 D0
8
th
1J!9!M8 1"0 90 D00
.
th
10!8!M9 "." 1D" 110

th
18!"!9. DMM 1D .D$9
J
th
"J!D!"000 M1M 8D0 110$M"
M
th
"!!"00. 1"MM 8J0 .J$8.Q
9
th
"J!8!"10 QQ".JJ 1"M9 100$0J
Qbefore the M
th
bipartite computeri6ation increment was settled$ we have to add
that also with this load
QQpension option cost excluded
2age load for 9
th
bipartite was, 3s$""D9 crores for officers i$e$ 8.$91 / and ".JJ
crores for award staff i$e$ .D$./ and Total wage load 3s 8M1 cr$
#n other words between M
th
and 9 bipartite the increase in wage load for award staff
(workmen) was 100$0J/ i$e$ in . years
A&&l"%g $he #"m"lar log"c $he "%crea#e "% 'age loa! $he "%"$"al offer "% $h"# /0
("&ar$"$e for 'or)me% alo%e ha# $o (e R# 25FF K 25FFU 5/5= cr
10J
A&&l"%g $he #ame log"c for (o$h off"cer# a%! a'ar! #$aff "f $he $ra!"$"o%al
a&&roach !"#$r"(+$"o% of 'age loa! $o a'ar! #$aff a%! off"cer# "# follo'e! a# $he
7
$h
("&ar$"$e &a$$er% $he $o$al 'age loa! "% r+&ee# for (o$h >'or)me% a%!
off"cer# ?#ho+l! (e m"%"m+m R#H<00 core# , 'h"ch "% &erce%$age $erm# 'or)#
o+$ $o 2F15%
I$ "# &er$"%e%$ $o +%!er#core here $he $o$al %+m(er of 'or)me% ha# come !o'%
from =,F0,000a# o% 2arch :/,200F $o =,50,000 a# o% 2arch :/,20/2, 'herea#
$he %+m(er of (ra%che# "% PS3C# "%crea#e! from =7,5F: $o <F,7:01 >o$her $ha%
ID3I (a%) ? !e#&"$e $he fac$ (e$'ee% /7H= $o 200= %e' recr+"$me%$# "% $he
PS3# 'a# #$o&&e!, a%! re#$r"c$"o%# 'ere "m&o#e! o% "##+a%ce of l"ce%#e#
a+gme%$"%g (ra%ch e8&a%#"o%, a%! aro+%! 2 la)h (a%) em&loee# acce&$e!
@RS 200/a%! $he"r -aca%c"e# 'ere %o$ f"lle! +&1 #n terms of statistics, the results
of A3+"001 scheme were dramatic$ #n "000!01, the staff cost of all the "J public
sector banks (including Corporation 5ank, which did not opt for A3+), was 3s
"1,0.0 crore$ 5y "001!0", staff costs had dropped to 3s 1M,9.9 crore$ There were
reports in news media that a candid notice were issued by some banks asking
customers to bear with the inconvenience caused by the voluntary retirement scheme
(A3+) says it all$ 5anks suffered as a result of the industry!wide A3+ that was
implemented by " banks from "000$ A3+s had an impact on employee morale$ 5ut
it is also true that the exercise has left several bank managements dissatisfied with the
results in business terms too$ #t should be acknowledged here that the surviving staff
in this crucial A3+ period shared additional work load to satisfy customer
inconvenience
(nd the wages as / to total expenses which was 18$ as on D1!D!"00M has
drastically come down to 1D$J" a son D1!D!"01"$ The business per employee which
was 3s$.98lacs as on D1!D!"00M increased to 11.1lacs as on D1!D!"01"$ The profit
per employee which was D$J lacs as on D1!D!"00M increased to $8 lacs as on D1!D!
"01"$
The productivity per employee, the business per employee and branch and
profitability of the public sector banks has enhanced many folds during the
interregnum$
1urther there is steep rise in the C,# inflation and the salaries in absolute terms have
also been eroded$ Consumer price index has already increased by 1.01 numbers over
8880 which was prevailing on 01P11P"01" i$e$ the level at which #5( has agreed to
merge the D( with basic pay$
Go+ #o' 'ha$ o+ rea&!

10M
2ith the banks amorti6ing the cost of A3+ "001 in their balance sheet , the same
method can be adopted by banks whose balance sheet are not robust because of
heavy provisioning of <,(, to meet the difference between #5(-s offer and unions
demand which can be offsetedPad'usted with <,( recovered during the amorti6ation
period by adapting aggressive steps mentioned above and due to bolstered
motivational levels of the employees in augmenting recoveries which 'ust revision
is bound to have effect$
9here $here "# '"ll, $here "# a'a!
The inevitable conclusion which even laity can draw therefore is I3AC #$alema$e
offer of //% 'h"ch amo+%$"%g o%l :=<5 crore# "# +%6+#$$ He%ce o+r !ema%! of
25% h")e amo+%$"%g $o R# FHF5crore# alo%e #hall mee$ E%! of 6+#$"ce, fa"r &la
a%! e*+"$1 >X1E1D1? (T5)% ,(#- %,0)"&-(#"%50)
L2a)"%g !ec"#"o%# "# of$e% !"ff"c+l$1 9e he#"$a$e, %o$ #+re "f 'e are ma)"%g $he
r"gh$ !ec"#"o%1 Some$"me# 'e %ee! $o $r+#$ o+r#el-e# a%! mo-e ahea!1 I$ "#
%ormal $o #eco%! g+e## o%eP# #elf R $o *+e#$"o% "f o%e "# !o"%g $he r"gh$ $h"%g1
3+$ +l$"ma$el, o%e m+#$ #$a%! +& a%! (e co+%$e!1 9ha$ !ec"#"o%# are o+
fac"%g $ha$ o+ are +%cer$a"% a(o+$W 9ha$ !ec"#"o%# are o+ regre$$"%g ha-"%g
ma!eW 9ha$ !oe# o+r hear$ #aW Do%P$ le$ o+r a%al$"cal m"%! '"%1 Tr+#$
o+r hear$1 5o ahea! '"$h o+r $ho+gh$ ce%$r"c &o#$#1M

R 3er$ol$ 3rech$
5erma% Poe$, Pla'r"gh$
/H7H ; /75<
CHAPTER 6 VII
CONCLUSION
109
WAY FORWARD
The goal of my dissertation in this approach paper is to enhance the awareness of the
bank employees and their well wishers to generate in&uiring minds, with view of
galvani6ing strategies to settle the present impasse in the on going 10 bipartite
negotiations$ 0y goal is to prepare and merge their hearts and minds to resist, repulse
the intransigence of #5( P=overnment combine in denying our 'ust wage revision by
considering our demand of minimum ". / that too in pay slip components as against
the tradition till 9
th
bipartite of settling wage load on establishment expenditure$

# have to the best of my ability enumerated things and events from an historical
perspective1 This paper for obvious reasons cannot be a full commentary of the
finished and unfinished tasks we have$
# am not merely pro or anti establishment$ %n the contrary # know that we am a
vital section of this establishment ourselves and unlike most other sections of the
establishment # want to develop and drive a self critical and critical viewpoint with
view of generating thinking , en&uiring minds, enhance awareness and learning$ #n
this process we learn, unlearn and relearn$ #t is with this sole ob'ective this approach
paper is presented1 To me +erving the interest of our members and contributing
to the developments of a free democratic trade union in the country is the goal
that # had fixed to myself $ $ This is my guide for the present and vision for future
4 a free community of trade unionsO independent but interdependent, non political but
politically critical, uniting one great family of working class, outgrowing and
transcending the hates and fears that rend our age$ # will not reach that goal today or
tomorrow$ # may not reach the goal in our lifetime$ 5ut the &uest is one of the
greatest adventures # wish could undertake$
+omebody was reported to be telling that something is better than nothing$ <othing,
if nothing happens, but everything possible should be explored, and for that
everybody should be prepared$ 2hen nothing is pro'ected as everything, anybody can
understand that something is wrong somewhere$ %f course the fault lies with #5($
They leak out some places of information and somebody loyal to them exaggerates
things and tries to mislead bank employees$ +o in this paper # have 'ustified our
demand under subheadings with some statistics, which 'ustify a better deal for
5ank *mployees in the ongoing 10 bipartite$
9e ha-e %arra$e! $"ll %o' "% 6+#$"f"ca$"o%# / $o <, (ac) '"$h ra$"o%ale, log"c, a%!
"% a h"#$or"cal &er#&ec$"-e 'ha$ 'e ha-e (ee% a(le $o !o a%! 'ha$ rema"%# $o
(e !o%e1 9e #ho+l! #elf cr"$"call e-al+a$e o+r &erforma%ce#, o+r &o#"$"-e #"!e#
110
a# 'ell a# o+r !ef"c"e%c"e# a%! o%l $he% ca% 'e ame%! o+r #hor$fall# a%!
#$re%g$he% o+r#el-e#
# consider it highly essential for the young generation of 5ank employees to be
conversant with the history of 5ank employeesE Trade 7nion 0ovement$ #t is a
matter of pride that $he &"o%eer# "% $he h"#$or of 3a%) Em&loee#P Tra!e U%"o%
2o-eme%$ $he f"r#$ a%! foremo#$ amo%g $he 3a%)D Em&loee#P Tra!e U%"o%
2o-eme%$ 'a# The Im&er"al 3a%) of I%!"a I%!"a% S$aff A##oc"a$"o% $ha$ 'a#
forme! "% /720 m+ch (efore $he a!-e%$ of I%!"a% Tra!e U%"o%# Ac$ "% /72< itself
$( glimpse of the glorious history of the bank employees movement is replete with
facts from (ug 1 till midnight of +ep 1., 198 the +trike in 5engal Circle stretching
from Chittagan' in <orth and <!* #ndia to ,eshawar in <orth!2est in the sub!
continent in D00 branches and pay! offices involving $100 employees +%!er $he
(a%%er of Im&er"al 3a%) of I%!"a I%!"a% S$aff A##oc"a$"o%$ 5efore launching the
strike action employees made repeated appeals to the bank to stop deductions of
1./ (10T./) from pay$ The 0onthly pay bill of $100 employees 4 3s$ "$J0$000P!
i$e$ avg$ 3s$ 88P! per head (excluding D$($)$ 5ut that of only 8" white officers (lords)
4 M.$000P! i$e$ avg$ 3s$"$"0P! per head (excluding D$($)$ +o the ratio 1: more than
.1$
The"r !ema%!# for #$r")e ac$"o% 'ereD
=0% RISE IN PAG (#n 19D1 the management effected a cut of 10/ on ,ay
on the plea of recession and a further cut of ./ towards ,ension 1und)
3escinding of ./ cut towards ,ension 1und Leave
rule as available to =ovt$ employees 0edical
Treatment at 5ank-s cost
,romotion ,olicy
=ratuity to those deprived of ,ension
+pecific working ?ours
Dearness (llowance as per cost of Living
,roper *n&uiry before entering adverse comments in the service record etc$
1orm 19.0 to 19" our service conditions were settled in #ndustrial tribunals$
5ecause of the bitter experience before the Tribunals from 1989 to 198, union
demanded direct negotiations and collectively bargained settlement to decide the
wages and service conditions of bank employees$ They l aunched powerful
agitation in 198, 19., 19 including the famous Kwork!to!rule movement- due
to which the =overnment and the bankers had to concede the demand and the f"r#$
e-er "%!+#$r I le-el ("&ar$"$e #e$$leme%$ 'a# #"g%e! o% /7;/0;/7<<1 Due to
efforts of the unions the principles of collective bargaining between #5(
(organisation of the employers in banks) and apex body of all #ndia unions in the
banking industry and settling dispute bilaterally and through dialogue came to
vogue instead of the government intervention in the matters pertaining to
111
employment conditions and industrial relations, +ince then, periodical 5ipartite
+ettlements have been entered into between #5( and unions , the last one being the
9
th
5ipartite +ettlement signed on "J!08!"010$ Th+# (a%) em&loee# ca% (e
6+#$l heral!e! are &rec+r#or# for "%$ro!+c$"o% of era of ("&ar$"#m "% o$her
"%!+#$r"e#, more #o "% P+(l"c Sec$or U%!er$a)"%g# "% I%!"a1
( ob'ective study of The collective bargaining agreements in public sector
undertakings including banking sadly revels that are always applicable to all the
permanent workers irrespective of whether they are formal members of the union or
not$ ?owever, the casual workers, which comprise about "0 per cent of the
workforce, are not bound by the collective bargaining agreements$ 7nions- right to
collective bargaining has had its ups and downs$ The management-s had their own
assumption about the legitimacy and role of collective bargaining and therefore the
true spirit of freedom of association and collective bargaining has been missing for
many years$ +ome agreements have clauses that are detrimental to the interests of
workers and workers feel that the various clauses are a sellout$ 5oth unions and
workers have resigned to the fact of the ascendancy of the management$
The history of collective bargaining also highlights that the management as well as
the unions have always operated with a '"% lo#e #$ra$eg and both the parties have
a$$em&$e! $o 3AR $he 5AIN (ra$her $ha% (arga"%) of each other$ (s a result, there
have been various strikes$ #n their absence the industrial relations have been far from
peaceful$ The management)workers and earlier union members allege)does not
accept the idea of collective bargaining in its true spirit$
Even in the ongoing negotiations in the 10 bipartite we find this unhealthy bar the
gain trend, against the ethos of true biapartism. While the unions have reduced
their demand from 30 %
(see the Hindu business line January, 16, 2014
http://www.thehindubusinessline.com/industry-and-economy/banking/wage-
revision-talks-bank-unions-may-demand-30-pa), IBA a has moved an inch
from 10 % to 11 % only during the last round of negotiations on 13-6-2014.
There after stalemate continues.
Thereaf$er 'e f"%! a #&ec$acle of %ego$"a$"o%# acro## $he $a(le $o$all #$alle!, &+$
$o coma$o#e a%! "# re&lace! '"$h e8cha%ge of $hree le$$er# (e$'ee% $he &ar$"e#
m+ch $o !"#g+#$ a%! !"#e%cha%$me%$ of $he (a%) em&loee#1 Th+# $he /0$h
"%!+#$r;'"!e ("&ar$"$e 'age #e$$leme%$ %ego$"a$"o%# "% $he (a%)"%g #ec$or ha-e
!ragge! o% for more $ha% o%e;a%!;a;half ear# %o' '"$ho+$ ma)"%g m+ch
hea!'a1
11"
Trade union members are not only workers, but also consumers and citi6ens$ (s
workers they expect unions to defend their rights and interests at work$ (s
consumers they are not content if the &uality is shoddy or inconsistent, prices are
unreasonable, supply erratic and attitudes of staff reprehensible$ (s citi6ens they
want their rights above other workers rights$ (s members of the community they
want the government to set things in order, stem pollution and cut red tape$ Thus
today trade unions have additional dilemmas because their members wear
different hats$ #n the enterprise where they work, they are affected employees
seeking to protect and defend the rights and interests as employees, or they look
at issues through the eyes of a consumer or member of the community$ 2e will
be isolated if we merely and narrowly pursue the selfish sectional interests of the
members at the enterprise$ 2e should therefore fit in the role of aligning our
members with the interest of those of the immediate community and the wider
society$
#t is time trade unions in banking industry look at changing role of trade union with
regard to its multiple stakeholders in the wider society: government, employers,
members, consumers, community, non!governmental organi6ations and other civil
society institutions and makes a case for demand of "./ hike by making for
broader coalitions and wider networking with social media, networking sites of bank
employees and for the bank employees to be able to make an impact$ There is
impetrative need to forge alliances establish broad alliances with various institutions
in the civil society$ (nd above all there is urgent need to form a real untied forum,
uniting all the unions in adapting a common strategy for struggle in fulfillment of this
demand and break the ongoing stalemate$
=overnments, #5( or 5ank unions acting alone cannot achieve economic prosperity,
stability and social progress to which public sector banks stand for$ +ocial dialogue
provides social partners in the negotiation table and other stakeholders with the
opportunity to participate in deciding their future$ The aim of this participation and
cooperation is to facilitate agreements on a mutually acceptable combination of 'ust
wages, progress of banks to subserve the ob'ects of progressive provisions of
reforms, economic and social progress, social security, stability and e&uity1 O%l a
mea%"%gf+l !"alog+e "# regar!e! &r"mar"l a# a mea%# a"me! a$ ach"e-"%g $he#e
goal#1 I$ "# a% effec$"-e $ool for #ol-"%g collec$"-e challe%ge# ( crea$"%g $he
#$r+c$+re a%! e%-"ro%me%$ #+"$a(le for more eff"c"e%$ &ro(lem;#ol-"%g1 #n other
words, it is about facilitating constructive interaction in order to arrive at social
consensusPcompromise among the stakeholders in the banking system$
The imperative need now is that that both the #5( and negotiating unions bring
out paradigm shift, reorientation in their values and beliefs while dealing with each
other to end the stalemate , impasse and move
11D
1rom To
+uspicion Trust
Confrontation Collaboration
1inding fault with each other 3especting one-s own faults
Disregarding each other 3especting one another
+elf centered 0utual benefit
Low credibility ?igh credibility
5eing biased 5ecoming ob'ective
Taking a stand and being closed *xamining possibilities and being open
=etting lost in trivial details +etting ones own priorities
Customer insensitive Customer sensitive$
I$ ha# $o (e real".e! $ha$ a 9IN; EOSE o&$"o% o%l lea!# $o #$ag%a$"o%, 'h"ch
ham&er# gro'$h1 I% $he c+rre%$ #ce%ar"o o%e ca%%o$ affor! $o #$ag%a$e1 O% $he
co%$rar "f e-er "##+e ca% (e a!!re##e! o(6ec$"-el, )ee&"%g "% m"%! $he "%$ere#$
of $he (a%), $he #ol+$"o% "# go"%g $o (e a% o(-"o+# o+$come 'h"ch 'o+l! f+r$her
lea! $o gro'$h of o+r orga%".a$"o%1 A 9IN;9IN &roce## lea!# $o &rogre## a%!
gro'$h of $he orga%".a$"o%, 'h"ch (e%ef"$# $he ma%ageme%$ a%! +%"o%1 # am
confident this model to be adopted by the parties in the negotiations cannot be
re'ected for its simplicity, for what each one of us need to understand is that there is a
simple way out to complex problems but the problem with us is that we can
understand simple things only when they are presented in a complex way$
Th"# heal$h mo!el "% IR #+gge#$e! ( me "# %o$ %e'1 I$ 'a# &ro&o+%!e! (
J+#$"ce Ka%$"lal De#a" "% J+%e /7<2 >Para 51/:H $o 51/=21 of De#a" A'ar!? 'h"ch
I am a&&e%!"%g (elo'1
LThe Nee! For 5oo! I%!+#$r"al Rela$"o% A%! Fa"r 9age S$r+c$+re I% The
3a%)"%g I%!+#$rM
The industr" of ban!ing does not produce goods but produces services# It is an
extremel" important services which is rendered b" ban!s and on the continued and
efficient functioning of ban!s depends the smooth functioning of a large number of
other industries, in the countr"# In order that the econom" ma" develop and other
industries ma" function smoothl", it is necessar" that the industr" of ban!ing should
also develop to meet the growing needs of the countr"# 1an!ing has to be regarded as
a public service and its activit" to a certain extent is being regulated in the public
interest# There are various provisions in the 1an!ing Companies .ct 8<9< and in the
0eserve 1an! of India not relating to the regulation to wor! in a more or less rigid
frame wor! set b" law# The depositing and investing alwa"s pla" for safet" for its
deposits and stabilit" for its investments# $rudent ban!er not merel" provide for what
118
are sometimes !nown as secret or undisclosed reserves but provide for eas" liquidit"
of some of its assets in order to meet an" emergenc"# The" also consider the
advisabilit" of following the polic" of maintaining stable dividends# +ver" effort has
to be made to gather the confidence of the public and the depositors so that the
wor!ing funds and operations of the ban! ma" grow#
The stabilit" of the industr" depends upon the overriding factor of credit# The ban!s
are ver" often described as delicate instruments of credit# The failure of the ban! has
its repercussions on the other ban!s and on the deposits made with other ban!s#
Great care is requirement to inspire the confidence of the public# Ceposits received
b" the ban!s constitute, to a ver" large extent, the raw material for providing
advances to persons needing the same# . 1an! unli!e a manufacturing concern
obtains a ver" large proportion of its wor!ing funds from the depositors and onl" a
small proportion from its share holders#
In considering the capacit" of the industr" of ban!ing to bear the burden of increased
wages which ma" be required to be paid having regard to the wor!menQs claims
based on social justice, it is necessar" to bear in mind the claim of the share holders
to a fair return on the capital invested b" them#
1an!ing is one of the !e" industries in the countr"# The successful implementation of
the ,ive Aear $lan depends to a considerable extent on the successful operation in
ban!ing in the countr"# It is requisite that the available resources of the countr"
should be harnessed for the successful implementation of the ,ive Aear $lan# 1an!s
have an important role to pla" in purposes# It is necessar" that the ban!ing habit
should spread throughout the length and breadth of the countr" so that the unused
wealth of the countr" is not merel" gathered but is put to effective use# The
dependence of commerce upon ban!ing has in modern times become exceedingl"
great and matters have reached a stage where the cessation for some length of time
of ban!ing activit" ma" paral"se to some extent the economic life of the nation#
1an!ers issue credit, exchange of currenc"# 1an!s assist the industrial underta!ing
b" underwriting their debentures and shares and occasionall" finance the purchase
of real propert"# 1an!s serve as custodians of stoc! and shares and other valuable#
Imports into and export out of the countr" are financed b" ban!s and documents
relating to the goods so imported and exported pass through the hands of the
1an!ers# The" have deal with warehouse warrants, bills of lading, railwa" receipts,
bills of exchange, marine insurance and various other documents# The" advance
mone" on securities and issue letters of credit and travelers cheques to customers#
The functions which the ban!ers discharge are numbers and varied# The transactions
on the stoc! +xchange ma" be affected b" the polic" adopted b" ban!s in connection
with the advantage on shares and securities# Transactions of purchase and sale of
various commodities ma" be affected b" the polic" adopted b" ban!s in connection
with the advance on such goods# +xpansion or retraction of credit ma" affect
11.
financing of various transactions# The smooth functioning of ban!s is necessar" for
the economic growth and welfare of the countr"# $eace in the industr" is requisite for
the economic progress of the countr" at the pace set b" the Third ,ive Aear $lan-#
@aving regard to these factors, wage scales have to be fixed such that it should not
be undul" below the pa"ing capacit" of the 1an! at the top of class nor undul" above
the pa"ing capacit" of the ban! at the bottom of class which is reasonabl" well
managed# ?ne does sometimes come across ban!s in private sector which continue
to function for number of "ears without distributing a na"s paisa b" wa" of dividend,
which do not show an" substantial profits or which show even losses for number of
"ears without an" special reason, when other ban!s functioning in the same region
with smaller wor!ing funds and reserves ma!e considerable profits# uch ban!s
which continue to exist for various reasons peculiar to those who run the ban!s
cannot be ta!en into account to depress the wages of class in which such ban!s fall#
It would be putting a premium on the existence of unhealth" ban!s if the" are
encouraged to continue their activities b" the incentive of lower wages-#
! @ustice >antilal Desai @une 19" (,ara .$1DM to .$18"$ of Desai (ward
Chief @ustice of the ?igh Court of =u'arat
The#e &ro-"#"o%# $he De#a" a'ar! are #$"ll "% -og+e a%! "# ("%!"%g o% I3A
If $h"# a&&roach &a&er #er-e# $he &+r&o#e of e%!"%g $he !ea!loc), re#+rrec$"o%
of %ego$"a$"o%#, a%! e8&e!"$e #e$$leme%$, m o(6ec$"-e of &re#e%$"%g $h"#
&rac$"cal a&&roach &a&er #hall (e #er-e!1
#n would like to end this approach paper with an inspiring anecdote which my
opinion is the way forward for unions$
?nce the five fingers, which normall" shared a warm friendship, got into a serious
argument# ?f course, the subject is the same old one that has been plaguing all living
things since the dawn of Time E namel" who is the biggest of them all# The Thumb
responded first with a contemptuous loo! on its face and with a perceptible sneer
wondering wh" there should be an argument at all about it# 'ithout me-, the thumb
said, "ou gu"s are powerless# Tr" doing an"thing without m" support and "ou will
!nowN- The middle finger laughed out aloud at this statement and said Aou p"gm"N
I am the tallest here and strategicall" placed at the middle# @avenHt "ou seen that in
an" group photo, the most important person occupies the middle seatP Co I need to
sa" an"thing moreP-
The ring finger listened to all this with a disinterested "awn# @e loo!ed around him
with the !ind of authorit" that onl" the affluent could afford to exhibit and, flaunting
his expensive diamond ring set in platinum, said, Aou gu"s seem to forget that I give
"ou all the status that "ou enjo"# .ll of "ou get noticed onl" because of meN- The
11
mercurial index finger was furious at this preposterous statement# tatus, m" foot-
he thundered# ConHt "ou gu"s !now that when our man is roused to fur", he uses me
to put his adversar" in his placeP .nd when someone see!s his direction, he uses me
again to show him the right path to ta!e# I am the s"mbol of his power and
authorit"-, he said# .ll fingers now turned to the little finger to hear what he had to
sa"# The poor fellow who was listening to all others had now shrun! to half of his
si(e with shame and remorse# @e could feel the loo! of ridicule around and he
started cr"ing#
Next morning, the owner of the fingers went to a temple and stood before the :ord in
pra"er with folded hands# .s the ringing of bells and drums reached a crescendo, the
:ord appeared before the little finger and smiled at him# The other fingers ma" be
big in their own wa" but "ou are the closest to me when "our man stands before me
with folded hands# Co "ou want to be bigger than thatP- @e as!ed the little finger
smilingl"# The little fingerHs heart overflowed with jo" and when he wept this time, it
was with tears of jo"N
2oral of $h"# #$orD
@ust like *very individual has a place to fill in the world, and is important in some
respect, whether he chooses to be so or not, every negotiating unions in the banking
industry are important entities by itself$ (ny call for preparedness for total unity and
struggle beyond mere verbosity and rhetoric has become more meaningful and
pronounced today than ever before in view of prolonged stalemate$
If o%l all // %ego$"a$"%g +%"o%# e%!ea-or $o (+"l! (roa!e#$ &o##"(le +%"$
amo%g#$ $he mem(er#, commo%al"$ of &erce&$"o% a%! &erfec$ am"$
a##"!+o+#l (+"l$ +& e-er'here $hro+gh !emocra$"c me$ho!# ( free a%!
+%"%h"("$e! e8cha%ge of -"e'# a%! $here( ma)"%g (a%) em&loee# +%"$ #$"ll
#$ro%ger ,%o$h"%g , %o &o'er ca% co+%$er-a"l (a%) em&loee# march $o -"c$or1
A!"o#! 5oo! E+c) $o all 3a%) Em&loee#!
9O4- U*#$: %*1 S'&#1%-#$: #! '4- R%#!'* 1;<$-7
CHAPTER 6 VIII
T+ S,#*$#&&%$#*. V':%. S' F%-1
11J
F-') V3%$#'4! T-#"%-$#$!) $' L%*1 M%-= B#"%-$#$#!)
>li!"%e% of )ur $o!entou% $ove!ent?
( revolutionary upsurge and a rising wave of mass strikes were witnessed all
over after 2orld 2ar ##$ The employees of the #mperial 5ank in 5engal were
already on an indefinite strike demanding fair wages and decent service
conditions$ #n such an atmosphere, the glaring discrimination, inferior service
conditions and unfair treatment meted out to the then #mperial 5ank employees
provoked the thoughts of the employees in our bank and other banks to organi6e
themselves into a Trade 7nion$
There were growing agitations and struggles for betterment of wages and
service conditions$ 5ank employees were getting organi6ed more and more and
there were strike actions by bank employees in different states$
#n this background, on :0;0=;/7=7, Central =overnment promulgated an
%rdinance whereby 5anking and #nsurance sector were made Central sub'ects in
respect of #ndustrial Disputes (ct$
#mmediately thereafter, on 1D!0!1989, all disputes in the banking industry were
referred to a <ational Tribunal headed by 'ustice > C +en$ the Tribunal gave its
(ward on /2;H;/750$ This was known as Se% A'ar!$ 1or the first time, service
conditions of bank employees were codified at (ll #ndia level$ 5ut bankers were
unhappy$ They challenged the +en (ward on technical grounds and
unfortunately on 9!8!19.1, the +en Tribunal was declared as null and void by the
+upreme Court$
This led to lot of resentment amongst bank employees and there were large scale
protests and agitations$ ?ence =overnment appointed another Tribunal with
@ustice Divitia$ 7nions ob'ected to his appointment as he was found to be a
shareholder in many 5anks$ ?ence @ustice Divitia was forced to resign in
(ugust, 19.1$
+truggles ensued, with strikes and actions rocketing in different states$ 2hen
thrust before tribunals and courts, the organi6ation continued its struggles there
also$ +imultaneously came the repressive measures from the 5ankers$ Trade
union activists and leaders came under the axe of dismissal, yet the struggles
continued relentlessly$ Thus the bank employees organi6ations grew and drew
into its fold bank employees in ever increasing numbers
#n view of the continued unrest in the banking industry, the =overnment
appointed another Tribunal on .!1!19." with @ustice ,anchapakesa +astry as
Chairman$ +astry Tribunal gave its (ward on 20;0=;/75:$ This (ward is
11M
famously known as SASTRG A9ARD$
5ut +astry (ward resulted in wage cut for bank employees$ %nce again
powerful agitation was launched by then 5ank 7nions$ ?ence the (ward was
referred to the Labour (ppellate Tribunal$ The EAT A'ar! given on 2H;=;/75=
restored the wage cut$ 5ut shockingly, the =overnment, at the behest of the
bankers, unilaterally modified the L
(ngered by this unfair and illegal action of =overnment, bank employees
observed the f"r#$ All I%!"a S$r")e ( 3a%) Em&loee# o% 2:;7;/75= and the
strike was a thunderous success$ (fter this then 5ank 7nions gave a call for
"%!ef"%"$e #$r")e from 10!1"!19.8$
SShr" @1@15"r", $he $he% Ea(o+r 2"%"#$er #+&&or$e! o+r ca+#e a%! re#"g%e!
from $he Ca("%e$ &ro$e#$"%g aga"%#$ $he 5o-er%me%$C# +%'arra%$e!
"%$erfere%ce '"$h $he 6+!"c"al &ro%o+%ceme%$ of EAT A'ar!1
, *,(/,"-'$ (,F5,&- -3, 0!"!&-,(& !" -3, 8(,&,"- .)/,("0,"- 63) 3#/, 6)"
6!-3 0#&&!/, 0#"%#-,= #"% 63)&, 100 %#$& )* .)/,("#"+, 3#& (,+,!/,%
)/,(63,'0!". #88(,+!#-!)" !" ",6& 0,%!# #"% !" -3, 0!"%& )* -3,
8,)8', -) (#''$ 6!-3 1#"2 ,08')$,,& *)( &8,,%$ &,--',0,"- )5( <5&-
%,0#"%#
The =overnment appointed 3a'ya Dhyaksha Commission on 1J!09!19.8 to
en&uire into the effect of L(T (ward$ 7pon his death, @ustice ,$5$=a'endra
=adkar was appointed as the head of this Commission$
Q7pon persuasion by many 0,s including Com$ +$($ Dange and +hri$ (shok
0ehta, 5ank 7nions deferred the indefinite strike$
:, (,F5,&- -3, 8().(,&&!/, M4>& !" -3, 8(,&,"- .)/,("0,"- -) (,8(,&,"-
)5( <5&- +#5&, *)( ,#('$ &,--',0,"- )* 10 1!8#(-!-, !08#&&, 6!-3
#88()8(!#-, %,+!%!". #5-3)(!-!,& !" 85(&5!- )* 8,#+, #"% 3#(0)"$ !" -3,
1#"2!". !"%5&-($ = -3, +)(, ,+)")0!+ 351 *)( +)5"-($>& 8().(,&& !" #''
&83,(,& #
=a'endra =adkar Commission gave its 3eport on ".!0J!19..$ This is known as
3a%) A'ar! Comm"##"o%$ The recommendation of this Commission was duly
incorporated by the =overnment by enacting #ndustrial Disputes >3a%)"%g
Com&a%"e#? Dec"#"o% Ac$, /7551
+ection 8 of this (ct provided that Sa#$r A'ar! a# mo!"f"e! by the L(T and
5ank (ward Commission would be effective up to D1!0D!19.9$
119
%n "1!0D!190, the =overnment appointed the <ational #ndustrial Tribunal
(5ank Disputes) with @ustice >$T$Desai as the ,residing %fficer$ The (ward of
this Tribunal known as DESAI A9ARD was published on 1D!0!19"$
The A'ar! 'a# ma!e effec$"-e from /;/;/7<2 $o :/;/2;/7<21 Ho'e-er,
5o-er%me%$ e8$e%!e! $he A'ar! +& $o :/;/2;/7<: a%! aga"% +& $o :/;0:;
/7<=1
5ecause of the bitter experience before the Tribunals from 1989 to 198, 5ank
7nions demanded direct negotiations and collectively bargained settlement to
decide the wages and service conditions of bank employees$ 5ank 7nions
launched powerful agitation in 198, 19., 19 including the famous Kwork!
to!rule movement- due to which the =overnment and the bankers had to concede
the demand and the f"r#$ e-er "%!+#$r I le-el ("&ar$"$e #e$$leme%$ 'a# #"g%e!
o% /7;/0;/7<<1Three "%!e&e%!e%$ +%"o%# e%$ere! "%$o #e$$leme%$ '"$h $he"r
re#&ec$"-e (a%) ma%ageme%$ o% l"%e# '"$h 'age# #$r+c$+re# arr"-e! a$
"%!+#$r le-el #e$$leme%$ '"$h f+r$her "%%o-a$"-e -al+e a!!"$"o%# "%
allo'a%ce# a%! o$her #er-"ce co%!"$"o%#1
+ince then, periodical 5ipartite +ettlements have been achieved by 5ank 7nions,
the last one being the 9
th
5ipartite +ettlement signed on "J!08!"010$
Thus, it can be said that the #er-"ce co%!"$"o%# of (a%) em&loee# are $o!a
go-er%e! ( $he &ro-"#"o%# of Sa#$r A'ar! >/75:? a# f+r$her ame%!e! (
#+(#e*+e%$ A'ar!# a%! Se$$leme%$#1
Thus it is a long 'ourney of struggles and achievements ! from 'ungle law to
Tribunals and (wards 4 from arguing before the third party Tribunals and getting
(wards to direct negotiations and signing 5ipartite +ettlements$ Today when we
see attacks on collective bargaining and bilateralism in the form of >handelwal
Committee recommendations$ The main task is to defend and preserve the system
of bipartism besides improving our wages and service conditions$
1rom the fierce and unrelenting struggles of the early days, when sacrifices were
as supreme as numerous, we have come a long way$ The vortex of history has
swallowed these names$ Get, let it not be forgotten that to!day-s sweet fruits have
come from their labours$ The path and progress of our union movement has been
consecrated by the blood of many martyrs$
The present generation is poised to face new challenges in pursuit of the coming
programmes on the health of the industry$ #t is their turn now to add new
dimensions to this sterling movement$ #t is their turn now to continue the heritage
and traditions of being pacesetters and pathfinders$
1"0
#n this historical task, let each and every one of the bank employees should
rededicate themselves so that the posterity will always remember them as those
who have contributed their best for the emancipation of the downtrodden
#n this historical background of &-(5..',&= &#+(!*!+,& #"% &5++,&&,&, %o' we are
endeavoring for 'ust resolution our reasonable Demand of ". / hike in pay slip
component in this ongoing 10
th
5ipartite 2age demands$
There "# %o al$er%a$"-e $o co%$"%+o+# a%! ar!+o+# #$r+ggle#!
Hol! h"gh $he !"g%"$ of la(o+r!
1"1
BANK EMPLOYEES
IMPROVEMENTS IN WAGES > SERVICE CONDITIONS
AWARDS ? SETTLEMENTS 6 JOURNEY SO FAR
S*T-#04*%&
(ppointed /:10<1/7=7
(ward =iven /210H1/750
Declared 2ull 3 4oid A"-#& 1@51
H5V5 D#/%$#% T-#04*%&
5ppointed J4&: 1@51 04$ -!#.*1
S%!$-: T-#04*%&
5ppointed 0550151@52
5ward 6iven 2050A51@5B
75& 2C50A51@5A
6ovt" Modification -rder 2A50C51@5A
Bank 5ward 8ommission 2550D51@55
9astry 5ward as modified 1@5D
D5 5mendment 2otification 1B50251@E0
D!%# T-#04*%&
5ppointed 2150B51@E0
5ward 6iven 1B50E51@E2
1
!$
B#"%-$#$ S$$&)*$ 1@51051@EE
2
*1
B#"%-$#$ S$$&)*$ 1251051@D0
9ettlement 2B50D51@D1
-ther :ssues 0C51151@DB
B
-1
B#"%-$#$ S$$&)*$ 0150C51@D@
-ther :ssues B151051@D@
9ettlement for B;8 8lass Banks 2251151@D@
9ettlement for J 3 < Bank and <4B 2251151@D@
9ettlement for =>change Banks 2251151@D@
Minutes of discussions with :B5 15 ? 1E50E51@C0
9ettlement 2150A51@C0
8omputer 9ettlement ? : 0C50@51@CB
-ther :ssues 0C50@51@CB
A
$+
B#"%-$#$ S$$&)*$ 1D50@51@CA
9ettlement on B 8lass Banks 2C50251@C5
-ther :ssues 0550151@CD
8omputer /57@M0 9ettlement ? :: 2@50B51@CD
5
$+
B#"%-$#$ S$$&)*$ 1050A51@C@
8omputer 9ettlement ? ::: 1050A51@C@
9ettlement on B 8lass Banks 0B50251@@0
1""
9upplementary 9ettlement 2@50E51@@0
9ettlement on B 8lass Banks 1B51051@@0
-ther :ssues 1E50D51@@1
8omputer 9ettlement ? :4 2@51051@@B
P*!#'* S$$&)*$ 2@51051@@B
Minutes of A,5 at 9urat Jaipur 7ucknow 2250E51@@A
E
$+
B#"%-$#$ S$$&)*$ 1A50251@@5
M-B on ,elative issue B050@51@@E
R&%$#/#$: S$$&)*$ 1A51251@@E
-ther :ssues 2C51151@@D
D
$+
B#"%-$#$ S$$&)*$ 2D50B52000
Disciplinary 5ction 3 Disciplinary @rocedure 1050A52002
C
$+
B#"%-$#$ S$$&)*$ 0250E52005
,ecord 2ote on @ension 2250E52005
@
$+
B#"%-$#$ S$$&)*$ 2D50A52010
P*!#'* O"$#'* S$$&)*$ 2D50A52010
1"D
Fnow at lea%t let t'e! not !ourn
an( allege Ban e!"loyee% earn6
!ore t'an t'ey yearn
%tati%tic% t'ey %'oul( learn=
9L'2 W%.! %*1 H#.+ P-'14,$#/#$: #! EGPLOITATION
L'2 P-'14,$#/#$: %*1 H#.+ W%.! #! CHARITY
L'2 W%.! %*1 L'2 P-'14,$#/#$: #! SUICIDE
H#.+ W%.! %*1 H#.+ P-'14,$#/#$: #! PROSPERITY7
1"8
FIVE DIFFICULTIES IN WRITING TRUTH
/? Co+rage $o 'r"$e $he $r+$h al$ho+gh "$ "# (e"%g #+&&re##e!1
2? The "%$ell"ge%ce $o recog%"#e "$, al$ho+gh "$ "# (e"%g co-ere! +&1
:? The 6+!geme%$ $o choo#e $ho#e "% 'ho#e ha%!# "$ (ecome#
effec$"-e1
=? The c+%%"%g $o #&rea! "$ amo%g $hem1
5? The $r+$h m+#$ (e (ea+$"f+l1
BERTOLT BRECHT H 1@BA
>Th"# Re&or$ "# !e!"ca$e! $o $he Tr"+m&h of Tr+$h?
1".
Those who take the meat from the table,
teach commitment.
Those for whom the taxes are destined,
demand sacrifce.
Those who eat their fll,
speak to the hungry of wonderful times to come.
Those who led the country into the abyss,
call ruling to difcult for ordinary folk
- Bertolt Brecht -
1"