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Will banks switch to a five-day work week soon? What IBA has agreed upon – details here

Soon you may not be able to visit your bank on a Saturday! Banking in India might soon witness a shift in its operational schedule. Currently, banks open on the first and third Saturdays but stay closed on the second and fourth Saturdays. Soon,

bank employees

might switch to a Monday to Friday schedule, meaning banks will be closed every Saturday and Sunday.

According to ET, the

Indian Banks Association

(IBA) and the All India Bank Officers’ Confederation have agreed to transition to a five-day work week, with Saturdays and Sundays off. This decision was finalised with the signing of the 9th Joint Note on March 8, 2024.
As per the press release, the Joint Note acknowledges all Saturdays as holidays, subject to government notification. The updated working hours will come into effect following the government’s notification.
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They’ve also agreed on a 17% annual salary increase, leading to an extra yearly expenditure of about Rs 8,284 crore for public sector banks. This raise, effective from November 2022, is expected to benefit up to 8 lakh bank employees.

Implementation

The effective implementation of the new work week is contingent upon government approval. Once approved, Saturdays will be officially recognized as holidays under Section 25 of the Negotiable Instruments Act.

The Section 25 of the Negotiable Instruments Act mandates the government to declare every Saturday as a holiday. The government, owning public sector banks, has authority in this matter. Additionally, the RBI’s acceptance is important as it regulates the timing of many interbank activities.

New timings for bankers

As per reports, the revised working hours under the new schedule may require bank employees to extend their workday by 40 minutes, from 9:45 AM to 5:30 PM.
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Impact on regular bank customers

The proposed change may affect regular bank customers who typically conduct their banking tasks on Saturdays will be affected by this change. However, given the numerous alternatives provided by banks such as mobile banking, ATMs, and internet banking, many customers now rely on these digital channels as their primary means of accessing banking services.

Will there be a salary hike?

As per the press release from the All India Bank Officers’ Confederation, the total increase in wage revision amounts to over Rs 8284 crores, constituting 17% of the establishment expenses of Public Sector Banks. After factoring in the applicable load of 3.22%, the effective load on basic pay post-merger of dearness allowance at 30.38% is 4.20%. The new pay scales range from Rs 48480/- to Rs 173860/-, encompassing all scales from Scale I to VII, and will be effective from November 1, 2022.