SBI and PNB may move out from 11th Bipartite Settlement

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variable pay in PNB and SBI

According to media reports, State Bank of India and Punjab National Bank are exploring possibilities to move out from 11th Bipartite Settlement. SBI and PNB are exploring to move to performance linked variable pay structure.

SBI is looking to give stock option plans to its employees to retain talent. Punjab National Bank has formed a committee of General Managers to explore possibilities of moving out from bipartite settlement and to introduce variable pay structure.

Government has already sent two letters to Banks and IBA to initiate the process for 11th bipartite settlement. Some Banks have given their consent to IBA for being part of 11the bipartite settlement.

MD and CEO of Punjab National Bank, Usha Ananthsubranium said that ‘we need to move out of old things as time is changing and need to recognize the performance and give remuneration to manage talent.

Although this is initial thoughts only, but if internal committees give positive feedback, the issue may be taken to board level.

 

The problem with existing wage structure is that employees in one rank are paid equally irrespective of their talent/ potential of performance. But moving from bipartite settlement to performance linked variable pay structure will not be easy for state run banks because they are not following established performance tracking systems.

Unless the performance appraisal of employees is not fair, transparent and undisputable, implementation of variable pay structure will not help the banks to attain the objective of rewarding performing employees and retaining talent.

Please give your opinion in comment box below.

5 COMMENTS

  1. If porformanc is not judged electronically then instead of fair it will be tool punishment for hard working employees

  2. Still it is hard to implement variable pay structure as there is need for much much improvement in HR DEPARTMENT before all this….

  3. Yes it should implement because there are so many bankers who never work never show performance but enjoy all benefits so what about the person who give best performance … So public sector banks want to survive in this competitive market it’s should implement .. I wish all the best to SBI and pnb for initiative.. pls go ahead for sure that time u can give justice to the person who work hard… If u implementing make sure it should be done same like MNC as biometric capturing performance electronically and many more thank u

  4. Yes I agree with in but the thing is who will decide the performance of employees …? If it is implemented then all employees will have to obey managers and and it may effect employees in daily lyf … Employees may have to sit late work on Sunday etc for impressing managers and higher authorities ..

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