*New Delhi, March 19:* The United Forum of Bank Unions (UFBU) has strongly objected to the recent directive issued by the Department of Financial Services (DFS), Ministry of Finance, regarding the implementation of a revised Performance Linked Incentive (PLI) scheme for senior officers in public sector banks.
In a press release issued on Thursday, UFBU termed the directive as “premature and inappropriate,” stating that the matter is currently under conciliation before the Chief Labour Commissioner (Central). The unions emphasized that issuing implementation instructions during ongoing discussions undermines the established consultative process and weakens industrial relations in the banking sector.
According to UFBU, the directive proposes PLI benefits for officers from Scale IV to Scale VIII, including Deputy Managing Directors in SBI, under a revised scheme that shifts from a uniform performance-based incentive to an individual performance-based system. The union alleges that this move could create divisions within the workforce and disrupt institutional harmony.
The forum also raised concerns over the financial implications of the scheme. While existing PLI provisions limit incentives to a maximum of 15 days’ basic pay plus dearness allowance for most employees, the revised scheme allows up to 365 days’ basic pay for senior officers—potentially increasing financial outgo significantly and raising questions about governance and equitable resource allocation.
Highlighting the broader impact, UFBU warned that the move may lead to internal disparities, reduced morale, and weakened teamwork across banks. It further noted that similar performance evaluation models, such as bell-curve systems, have already been abandoned globally by major corporations due to their negative impact on collaboration and workplace culture.
The union body urged the DFS, Indian Banks’ Association, and bank managements to keep the directive in abeyance and resolve the issue through dialogue and conciliation mechanisms. It cautioned that unilateral implementation could trigger unrest and compel employees to resort to lawful agitational measures.
UFBU reiterated its commitment to protecting the principles of fairness, collective bargaining, and industrial harmony that have long defined the banking sector.
