The Department of Financial Services has put the Performance Linked Incentive (PLI) for senior PSB executives on hold for FY 2025-26, following intense pressure from banking unions.

  • The Department of Financial Services (DFS) has placed the PLI for Scale IV to VIII executives in abeyance.
  • The decision follows widespread representations and agitation by bank employee unions.
  • The PLI issue will now be addressed during the 13th Bi-partite Settlement discussions.
  • AIBOC has hailed the decision as a victory for collective bargaining.

In a significant development for the Indian banking sector, the Department of Financial Services (DFS), under the Ministry of Finance, has decided to keep the payment of the Performance Linked Incentive (PLI) for Scale IV to VIII executives of Public Sector Banks (PSBs) in abeyance for the financial year 2025-26. This move comes after intense pressure and sustained representations from various bank employee organizations.

In a formal communication issued on Monday to the Chairman of the State Bank of India (SBI) and the CEOs/MDs of all nationalized banks, the DFS clarified that the matter would be integrated into the ongoing 13th Bi-partite Settlement and 10th Joint Note discussions. The original PLI scheme for Whole Time Directors and Senior Executives had been notified back on November 19, 2024.

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Why This Matters

BozokMedia analysis shows that this decision highlights the critical role of organized labor in the public sector. By moving the PLI discussion to the Bi-partite Settlement framework, the government has effectively acknowledged that incentive structures cannot be implemented in isolation from broader wage and benefit negotiations.

The government's decision reflects the undeniable impact of a united banking fraternity standing against unilateral policy changes.

Rupam Roy, General Secretary of the All India Bank Officers' Confederation (AIBOC), described the suspension as a direct consequence of the collective opposition mounted by the United Forum of Bank Unions (UFBU). Roy noted that the threat of strike action and continuous agitation played a pivotal role in forcing the government's hand.

The Unresolved Battle: Five-Day Work Week

While the suspension of the PLI scheme is being celebrated as a victory, the broader struggle for banking employees remains far from over. A major sticking point remains the implementation of the Five-Day Work Week. Despite previous agreements, bank unions argue that the implementation has been unnecessarily delayed by the authorities.

A conciliation meeting is scheduled before the Chief Labour Commissioner (Central) to review the progress made and determine the next course of action for the UFBU. The banking community remains vigilant, shifting their focus from the PLI dispute to the long-standing demand for improved work-life balance.

Did You Know?: Bi-partite settlements are the cornerstone of industrial relations in Indian banking, determining the economic terms for hundreds of thousands of employees.

Frequently Asked Questions (FAQs)

1. Does this decision affect all bank employees?
The current suspension specifically targets Scale IV to VIII executives of Public Sector Banks.

2. What is the next step for the PLI scheme?
The scheme will be discussed and potentially restructured during the upcoming 13th Bi-partite Settlement talks.