The Centre pushed back against bank unions’ claim that a five-day working week had already been agreed, with Finance Ministry sources saying the government had made no such commitment during wage negotiations. The clarification came just days before bank employees are scheduled to begin a three-day nationwide strike from September 28, with the five-day banking demand now the central point of confrontation between the government and unions.
The United Forum of Bank Unions, which represents a large majority of employees and officers in the banking sector, has maintained that an understanding on making all Saturdays holidays was reached with the Indian Banks’ Association during the wage revision settlement in March 2024. The government, however, has drawn a distinction between an understanding reached between the IBA and unions and final approval from the Centre.
Government disputes union claim
Senior government sources said a five-day working week was neither agreed to by the government nor used as a negotiating point during the earlier wage discussions. They accused the unions of presenting the circumstances surrounding the 2024 settlement inaccurately.
The 12th Bipartite Settlement signed in March 2024 recorded an understanding between the IBA and unions on declaring all Saturdays as holidays and said the IBA had recommended the proposal to the government. It also made clear that changes in working hours would become effective only after approval from the Government of India and the necessary clearances. That approval has not been granted.
The dispute therefore centres partly on what the 2024 understanding represented. Unions view the IBA-union agreement and subsequent recommendation to the government as a commitment to five-day banking, while government sources maintain that the Centre itself never agreed to implement the proposal.
Three-day strike from September 28
The UFBU is going ahead with its nationwide strike from September 28 to 30 after talks failed to produce a breakthrough. The timing is particularly significant because September 30 is the half-yearly closing date for banks, involving reconciliation, provisioning, treasury and market operations.
Bank employees currently get holidays on the second and fourth Saturdays of every month, while branches remain open on the first, third and fifth Saturdays. The unions want all Saturdays declared holidays, creating a Monday-to-Friday working week, and have argued that working hours on weekdays can be adjusted to compensate.
The unions have also pointed out that the Reserve Bank of India and the Department of Financial Services operate on a five-day schedule. They argue that bank employees should receive a similar arrangement after years of discussions on the issue.
PLI demand put on hold
Five-day banking was initially one of two principal issues behind the unions’ agitation, the other being opposition to a revised Performance Linked Incentive scheme. The government has since decided to keep the PLI scheme in abeyance, leaving the five-day week as the principal unresolved demand.
The Finance Ministry said a one-day strike had already been held on September 11 despite conciliation efforts. Apart from the September 28-30 action, unions have proposed an indefinite strike from October 26 if the five-day banking issue remains unresolved.
With the three-day strike immediately following the weekend, the government has warned of prolonged disruption to branch-based banking services. Public sector banks and Regional Rural Banks have consequently been asked to remain open on Sunday, September 27, to give customers an additional day to complete transactions before the strike begins.
Customers brace for disruption
The government has asked bank employees to reconsider the strike and ensure uninterrupted services, arguing that an extended shutdown could affect customers, businesses, government transactions and international banking operations. Banks have also been preparing contingency measures to keep ATMs supplied and digital banking channels operational.
UPI, mobile banking, internet banking and other automated services are expected to remain available, although branch-based services, cheque clearing and other employee-dependent operations could face disruption depending on participation in the strike.
With neither side retreating from its position, the dispute has now narrowed to a fundamental disagreement over what was actually settled in 2024. The unions say five-day banking was agreed with the IBA and merely awaits government approval; government sources insist the Centre itself never made such a commitment.