2nd Option of Pension for Compulsorily Retired Officers/Employees
Indian Banks' Association
HR & INDUSTRIAL RELATIONS
No.HR&IR&HR/CIR/G2/BRK/4684
March 16, 2018
Chief Executives of Member Banks which
are parties to the Bipartite Settlement
Dear Sir/Madam,
2nd Option of Pension for Compulsorily Retired Officers/Employees
The
United Forum of Bank Unions (UFBU) representing workmen and officers in
Banks were requesting to allow another option to those Who were in the
service Of the Banks prior to 29th September, 1995 in case of
Nationalized Banks / 26th March, 1996 in case of Associate Banks of
State Bank of India and continued in service on or after that date and
did not opt for pension when offered as per the scheme.
2. After
holding various rounds of discussions in the matter, consensus was
arrived at between the parties and a Bipartite Settlement/Joint Note was
signed on 27.4.2010 to extend another option of pension to those
Workmen / Officers who:-
(a) were in the service of
the Bank prior to 29th September, 1995 in case of the Nationalised
Banks/26th March, 1996 in case of Associate Banks of State Bank of India
and continue in service of the Bank on the date of signing above
mentioned Bipartite Settlement/Joint Note;
(b) exercise an option in writing within 60 days from the date of offer, to become a member of the Pension Fund and
(c)
authorise the Trust of the Provident Fund of the Bank to transfer the
entire contribution of the Bank along with interest accrued thereon to
the credit of the Pension Fund. In addition, the individual
employee/officer has to pay @ 2.8 times of the revised pay for the month
of November 2007.
(d) were in service of the Bank prior to 29th
September 1995 in case of Nationalised Banks /26th March 1996 in case of
Associate Banks of State Bank of India and retired after date and prior
to the date of above mentioned Bipartite Settlement/Joint Note i.e.
27.04.2010;
(e) exercise an option in writing within 60 days from the date or offer to become a member of the pension fund and,
(f)
refund within 30 days after expiry of the said period Of 60 days, the
entire amount Of the Bank's contribution to the Provident Fund and
interest accrued thereon received by the employee/officer on retirement
together with the payment over and above the said amount at 56% of the
amount.
3. Families of above mentioned employees
officers were also made eligible for said option subject to refund of
Bank's contribution to the Provident Fund received by them as mentioned
in point (f) above.
4. 2nd option of Pension was, however, not
made available to the employees/officers who were compulsorily retired
by the Bank. As such, some of these aggrieved employees/officers
approached different Hon'ble High Courts seeking relief in the matter.
Various Hon'ble High Courts viz Andhra, Madras, Madhya Pradesh, Punjab
& Haryana and Patna have ruled in favour of the employees\officers
who were compulsorily retired. However Hon'ble Delhi High Court has
taken a contrary view on the technical ground.
5. The matter was
placed before the Standing Committee on HR of IBA in its meeting held on
07.12.2017. Aner deliberations, the committee recommended to place the
matter before the Managing Committee of IBA. Accordingly. the matter was
put up to the Managing Committee of IBA in its meeting held on
29.12.2017. The committee advised to seek legal opinion on the
judgements as to whether 2nd option of pension may be allowed to all
ex-officers/ex-employees who were compulsorily retired from Bank’s
service between 29.09.1995 to 27.04.2010 or only selectively to those
who approached the Bank for the same.
6. The legal opinion from
Shri S.D.Kelkar, Senior Partner, Kelkar & Associates whose services
have been engaged in IBA as retainer, Was obtained in the matter, His
opinion is as under:
"Having considered the decisions
rendered by the Hon'ble High Courts of Andhra Pradesh, Madras, Madhya
Pradesh, Punjab & Haryana, Patna which have ruled in favour of the
employees/officers who were compulsorily retired way way of punishment/
on the ground that they are covered by the Joint Note as well as
decision of the Hon'ble Delhi High Court which has taken a contrary view
on the technical ground and the fact that SLPs preferred against the
Judgments of the High Courts which had ruled in favour of the employees
were dismissed though such dismissal cannot be considered as law laid
down by the SC., we are of the considered view the banks are bound to
give 2nd option to all the employees/ officers who were compulsorily
retired and who fall within the ambit of the Joint Note to exercise
option for the following reasons:-
The Joint Note does not distinguish between voluntary retirement, superannuation, premature retirement, compulsory retirement.
Even
the employees/ officers who are compulsorily retired by way of
punishment are eligible for pension under the pension regulations.
Banks
being "State" within the ambit of Article 12 of the Constitution of
India should act in a fair and reasonable manner and should not restrict
it only those who demand it. Such stand, if any, adopted by the banks
may invite strictures from Courts'.
7. The views of the Legal
Retainer of IBA were placed before the Managing Committee of IBA in its
meeting held on 25.01.2018. The committee after deliberation concurred
with the legal opinion placed before it and advised to inform all PSBs
accordingly. The exact modus operandi of the extension of 2nd option to
compulsorily retired employees/officers was to be worked out in
discussions with GMs (HR) of PSBs to decide on a uniform methodology
which will stand scrutiny of court.
8. To work out the methodology
in this regard, a meeting of the GMs (HR) was convened on 28.02.2018 at
IBA. After detailed discussions, a consensus has been arrived at to
extend the option of pension to compulsorily retired employees/officers
on same terms & conditions as are mentioned in Bipartite
Settlement/Joint Note dated 27.04.2010, As per the agreed terms &
conditions of said Bipartite Settlement/Joint Note, Pension/Family
Pension shall be payable with effect from 27th November, 2009, provided
that employees/officers who are compulsorily retired after that date
shall get pension from the respective dates of such retirement. Court
cases, if any, in the matter may be withdrawn forthwith.
9. Please do the needful accordingly.
Yours faithfully,
sd/-
B Raj Kumar
Deputy Chief Executive
Source: http://www.iba.org.in/
