AIBEA CIRCULAR on Khandelwal Committee on HR Issues in Public Sector Banks..UFBU / AIBEA would be shortly organising exclusive protest actions/strikes:

CIRCULAR  LETTER NO. 26/154/2011/48                          30^th October, 2011

TO

ALL OFFICE BEARERS/STATE FEDERATIONS/ALL INDIA BANKWISE ORGANISATIONS &  AIBEA’s WORKMAN DIRECTORS                     

                                                                                           /   IMPORTANT  /

Dear Comrades,

You are aware that Khandelwal Committee on HR Issues in Public Sector Banks has submitted its report to the Government.  The recommendations are quite retrograde and anti-employee.  A gist of the recommendations are given in the Annexure herein.

WHOLESALE ATTACK:  The thrust of the recommendations are aimed at dismantling our collective bargaining, bipartite system of wage revision, making bank jobs elite oriented, freedom on mobility by disturbing all Transfer Policy Settlements, free hand on outsourcing all bank jobs, reducing promotion of clerks as officers and increasing direct recruitment of officers upto 50%, introducing incentive based differential pay and cost-to-company methods, dislocation of clerical staff in the name of compulsory rural stint, etc. 

In essence, it is an attempt to scuttle all that our movement has achieved and secured in the last six decades and more through our unity and struggle.  The aim is to weaken trade union movement and provide union-free environment to facilitate easy implementation of banking reforms and privatisation of banks and ensure job conditions that are most suited to private sector banking.

IMPORTANT :  It is learnt that the Government is moving towards the implementation of these recommendations and Public Sector Banks have been advised accordingly.  While UFBU / AIBEA would be shortly organising exclusive protest actions/strikes against such attempts, we must be careful against any attempt to push through these measures in any of our Banks. 

1. All our Bankwise Organisations are cautioned to be vigilant in this regard and any attempt to implement any of these recommendations must be resisted and fought back organisationally. 

2. Our Workman Directors are specifically advised to be careful if any related agenda is brought before the Board Meetings.  They must vehemently protest against any move to pass any of these measures and must walk out of the Board meetings after marking their dissent.

With greetings,

Yours Comradely,

C.H.VENKATACHALAM

GENERAL SECRETARY

MAJOR RECOMMENDATIONS

   MANPOWER AND RECRUITMENT PLANNING :

§  To be an annual well structured and rigorous exercise for 5 year period, factoring gaps in skills and competencies.

§  Banks to monitor staff costs and endeavor to achieve staff cost ratio of 50% in the next 5 years;

§  PSBs to outsource non-core activities;

§  To implement Business Process Re-engineering (BPR) and Change Management.

§  PSBs to reach Officer-clerk ratio of  1 : 0.5 for metro and urban branches &  1 : 0.75 for rural and semi-urban branches in next 3 years.

§  Recruitment of direct officers to be 50% of total officer vacancies;

§  Entry qualification for clerical recruitment to be graduation;  for sub-staff, X standard pass.  Standard of recruitment of new clerical and officers staff to be raised in tune with the new requirements.

§  Fresh recruitment of clerks to be restricted to rural and semi-urban branches; rural service to be made mandatory for new clerks.

§  Banks to incentivize mobility of clerical staff to rural areas;

  TRAINING AND SKILL DEVELOPMENT OF STAFF :

• New dispensation for training called for – Training system to focus on creation of talent pool in critical areas.
• Greater focus to be given to women and staff in rural areas.
• E-learning to be extensively used.
• Role related training to be compulsory for executives in Scale IV and above.
• External and overseas training to be aligned to talent management strategy.

   CAREER PLANNING :

• Officers to be provided well rounded exposure in banking operations before entering Scale IV.
• Present mandatory rural service for officers to be continued.
• Promotion process to be vigorous and methodology to include modern tools.
• System to be put in place for identifying star performers and tracking their performance.
• Special HRD efforts to be in put place for development of women and SC / ST employees.
• Sabbatical leave of 2 years to be allowed at request to women  employees;

   PERFORMANCE MANAGEMENT :

• Promoting high performance culture across the organization to be the objective – Performance Management System (PMS) to be a credible, transparent and interactive system covering all categories of staff – including workmen staff.
• Discipline of PMS to be enforced – Appraising authorities to be accountable for proper and timely assessment.
• 360 degree feedback system to be introduced for Scale IV and above.

   Reward Management :

£  Broad contours of the principles that may govern the performance – linked incentive schemes of PSBs:

• The incentive scheme should aim at performance differentiation and reward the pivotal employees.  This is with a view to retain employees in critical areas and build future leadership pipeline.
• Total amount of incentive to be paid by a PSB in a year not to exceed 2% of its average net profit earned over the previous two years.
• Incentive to be limited to 25% top performers who are covered under PMS.
• The Committee further recommends that in tune with market trends, PSBs may consider offering Employee Stock Option Plan (ESOP), in the future, as a measure of promoting ownership in the employees as also retaining talented workforce.  This is to be limited to 15% top performers in the executive cadre including CMDs and EDs.

   Succession Planning and Leadership Development :

• Succession planning to be introduced for identified critical and leadership positions – Each position to have 3 persons in the reserve.
• Comprehensive leadership development strategy to be developed for Scale IV and above.
• Modern HRD tools like Assessment Centre and 360 degree feedback to be used for potential identification.
• A common pool of GMs in the industry to be created for future ED / CMD positions.
• Bankers’ Leadership Development Institute (BLDI) to be set up for creating future leaders, research, benchmarking, best practices, etc.

   PROFESSIONALISATION OF HR :

• Large banks to be provided ED (HR) to drive HR agenda from the top.
• A steering Committee of the Board on HR to be constituted to discuss critical HR issues.
• A Monitoring Group to be set up at the Ministry for monitoring HR transformation agenda in PSBs.
• HR professionals to be recruited at senior and junior levels.
• HR administration to be automated through web-based system.
• HR audit to be introduced.
• Award to be instituted for best HR practices.

   WAGES & SERVICE CONDITION :

• PSB Boards to decide on bank-specific wage and compensation structure, in relation to capacity to pay, profitability, productivity, etc. and strictly within the overall guidelines of the Government in this regard.
• Banks to consider variable pay as a major component of wages.  In such an arrangement, banks to have the discretion to go in for Cost-to-Company (CTC) concept.

INDUSTRIAL RELATIONS :

• PSBs to revisit and review all internal settlements that affect mobility, flexible utilization of staff, productivity, performance and customer service.
• Bank managements to accord priority treatment to the issues of productivity and performance acceleration while dealing with IR issues.