The 12th Bipartite Settlement is a significant agreement between the Indian Banks’ Association (IBA) and the United Forum of Bank Unions (UFBU), representing bank employees and officers in India’s public sector banks. Signed on March 8, 2024, it outlines revisions to salaries, allowances, and working working conditions for approximately 400,000 bank employees across 25 banks (including 12 public sector banks, 10 private banks, and 3 foreign banks). Effective from November 1, 2022, to October 31, 2027, this settlement addresses wage revisions, benefits, and work-life balance initiatives, impacting roles like the IBPS Clerk, SBI Clerk. Below is a clear explanation of its key aspects in plain English, incorporating relevant details from the provided context.
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What is a Bipartite Settlement?
A Bipartite Settlement is a negotiated agreement between bank management (represented by the IBA) and employee unions (UFBU) to revise wages, allowances, and service conditions every five years. The 12th Bipartite Settlement is the latest in a series that began in 1966, ensuring fair compensation and addressing employee concerns amidst economic changes like inflation. It also includes the 9th Joint Note, which specifically covers officers’ wage revisions.
SBI Clerk Salary After 12th Bipartite Settlement
Key Features of the 12th Bipartite Settlement
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17% Salary Increase:
The settlement introduced a 17% hike in the pay-slip component, including a 3% load factor applied to both basic pay and Dearness Allowance (DA). This means the overall salary on the payslip increases by 17%.
For IBPS Clerks, the starting basic pay increased from ₹19,900 to ₹24,050. The pay scale is now ₹24,050–1,340/3–28,070–1,650/3–33,020–2,000/4–41,020–2,340/7–57,400–4,400/1–61,800–2,680/1–64,480 over 20 years.
The gross salary for a clerk is around ₹41,170, with an in-hand salary of ₹38,180–₹40,000 after deductions, depending on the city. -
Revised Allowances:
- Dearness Allowance (DA): Set at 10.25% of basic pay, revised quarterly based on the Consumer Price Index.
- House Rent Allowance (HRA): Ranges from 6.5% to 8.5% of basic pay, higher in metro cities like Mumbai.
- Special Allowance: Increased to 26.50% of basic pay (with DA), but not counted for superannuation benefits like pension or gratuity, which has drawn criticism.
- Travel Allowance: Covers official travel expenses.
- Medical Allowance: Fixed at ₹2,000 annually.
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Arrears Payment:
The salary revisions are effective from November 1, 2022. Employees receive arrears for the period from November 2022 to February 2024, paid in phases starting March 2024. -
Work-Life Balance Initiatives:
- Five-Day Work Week: A major demand, the settlement pushes for a five-day work week (pending government approval). This aligns with institutions like RBI and LIC, aiming to reduce stress and improve work-life balance. Second and fourth Saturdays are already holidays since the 10th Bipartite Settlement (2015).
- Flexible Working Hours: Introduced to enhance employee well-being.
- Improved Leave Policies: Enhanced maternity and paternity leave provisions.
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Performance-Linked Incentives (PLI):
A new PLI formula was agreed upon in June 2024, rewarding employees based on bank performance, boosting morale and productivity. -
Other Benefits:
- Pension and Ex-Gratia: Revised pensions for retirees post-November 2022 and monthly ex-gratia payments for eligible pensioners (pre-November 2022).
- Medical Insurance: Separate schemes for in-service and retired employees, though high premiums for retirees remain a concern.
- Transfer Allowance: Revised to include higher train freight charges.
Financial Impact
The settlement results in an additional outflow of ₹12,589 crore for public sector banks, with ₹8,424 crore for officers and ₹4,165 crore for workmen (clerks and sub-staff). This reflects the IBA’s commitment to improving compensation while balancing bank finances.
Criticisms and Unresolved Issues
While the settlement is a milestone, it faced criticism:
- Special Allowance Issue: The Special Allowance (26.50% of basic pay) is not included in superannuation benefits, affecting pensions, NPS, PF, and gratuity. Unions demanded merging it with basic pay, but only a 3% load factor was conceded.
- Medical Insurance for Retirees: High premiums and reduced benefits in the retiree scheme disappointed many, with some exiting due to costs.
- Increased Clerical Duties: New responsibilities, like ATM cash loading and loan recovery, were added, raising concerns about workload. Some unions criticized the lack of transparency in negotiations.
- Unsettled Demands: Issues like pension updates for past retirees, a uniform DA index, and a defined benefit pension scheme for NPS employees remain unresolved, with negotiations ongoing.
- Regional Rural Banks (RRBs): RRB employees demand inclusion in the settlement for wage parity, but implementation is incomplete, leading to disputes.
With some employees welcoming the five-day work week but others protesting the settlement as inadequate or anti-employee due to limited financial gains and increased duties.
Why It Matters
The 12th Bipartite Settlement is a critical step for India’s banking sector, addressing employee needs in a challenging economic environment.
The 17% salary hike, improved allowances, and work-life balance measures (like the potential five-day work week) enhance the attractiveness of roles like IBPS Clerk, SBI Clerk, IBPS PO, SBI PO etc.
However, unresolved issues and criticisms highlight the need for ongoing dialogue to ensure fairness, especially for retirees and RRB employees.
For IBPS Clerks, the settlement means a starting in-hand salary of ₹38,180–₹40,000, with growth to ₹44,000–₹46,000 after 5 years and ₹58,000–₹62,000 after 10 years, making it a financially rewarding career.
Final Thoughts
The 12th Bipartite Settlement, signed on March 8, 2024, brings substantial benefits like a 17% salary hike and work-life balance improvements but falls short on some union demands, particularly around pensions and retiree benefits.
It’s a balanced effort to support bank employees while maintaining industry stability. For the latest updates, check official sources like the IBA website (www.iba.org.in) or UFBU circulars.
FAQs: 12th Bipartite Settlement
Q: Is there a 12th Bipartite Settlement?
A: Yes, the 12th Bipartite Settlement was signed on March 8, 2024, between the Indian Banks’ Association (IBA) and the United Forum of Bank Unions (UFBU). It is effective from November 1, 2022, to October 31, 2027, covering wage revisions and benefits for approximately 400,000 bank employees across 25 banks, including public sector, private, and foreign banks.
Q: How much salary will increase after the 12th Bipartite Settlement?
A: The 12th Bipartite Settlement introduced a 17% hike in the pay-slip component, including a 3% load factor on basic pay and Dearness Allowance (DA). For IBPS Clerks, the starting basic pay increased from ₹19,900 to ₹24,050, resulting in an in-hand salary of ₹38,180–₹40,000 per month, up from approximately ₹32,000–₹34,000. The gross salary is now around ₹41,170, with an annual CTC of about ₹6,50,000.
Q: What is the new DA after the 12th Bipartite Settlement?
A: The Dearness Allowance (DA) after the 12th Bipartite Settlement is set at 10.25% of the basic pay for IBPS Clerks and other bank employees. It is revised quarterly based on the Consumer Price Index to adjust for inflation.
Q: Will there be a 13th Bipartite Settlement?
A: As of now, there is no official confirmation regarding a 13th Bipartite Settlement. The 12th Settlement, effective until October 31, 2027, is the current agreement. Typically, bipartite settlements occur every five years, so a 13th Settlement might be negotiated around 2027–2028, depending on discussions between the IBA and bank unions. Check official IBA or UFBU sources for future updates.
Note: Salary figures and benefits are approximate and subject to bank-specific policies. Verify details through official notifications from IBA or participating banks.
