Bank unions and the Indian Banks Association on 2nd June 2005, signed the eighth bi-partite wage agreement. The banking sector settlements will be effective until October 2006.

Bank employees will get arrears of wages from November 1, 2002 to May 31, 2005. Over 2 lakh officers and over 5 lakh award staff from 27 public sector banks and 13 old private sector banks will benefit from these arrears.

The basic pay for bank employees will increase by 8.22 per cent post the wage revision. Employees in the clerical cadre are expected to get a rise in the range of Rs 600 to Rs 2,500 per month, while subordinate staff will get a rise of Rs 450 to Rs 1,500 per month. For officers the net increase is expected to be in the range of Rs 435 to Rs 8,335 per month.

Dearness allowance compensation has been raised from 75 per cent to 100 per cent.

The pension scheme, which was reduced to 42 per cent of the last drawn pay in 1997, has been restored to 50 per cent. Another highlight of the revised settlement is the introduction of encashment of leave travel facility.

Allowances, including halting allowance, have been revised and improved upon.

Demands relating to hospitalisation charges, which remained unchanged during the last settlement, have been considered favourably and improved upon.