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/