During the wage revision negotiations, the United Forum of Bank Unions (UFBU) raised the issue of extending the pension scheme option to resigned employees and officers, which was agreed upon by the Indian Banks’ Association (IBA). This led to the signing of a memorandum of understanding (MoU) between the IBA and UFBU on 9th November 2023. Subsequently, the Government approved the extension of the pension scheme to resigned employees and officers based on the IBA’s recommendation.
Eligibility Criteria
Eligibility for the extended pension scheme includes employees and officers who were in service of the banks on or after 1st January 1986, joined the banks before 1st April 2010, and resigned from the service of the bank on or before 26th April 2010. In addition, they should have been eligible to join the pension scheme while in service and have completed 20 years of service or more at the time of resignation. In the event of an employee’s death after resignation, the surviving spouse or eligible family member can opt for the family pension.
Refund Requirement
Resigned employees and officers eligible for the pension scheme extension are required to refund the entire bank’s contribution to the Provident Fund, along with accumulated interest received at the time of their resignation from the bank. No additional interest is applicable in this case.
Pension Calculation
As per the Pension Regulation, the pension payable is 50% of the pay if the employee completed 33 years of service at the time of resignation. In other cases (20 to 32 years), the pension is calculated as 50% of pay multiplied by years of service divided by 33. The pension and family pension will be payable prospectively.
Conclusion
This development marks a significant achievement for UFBU, as resigned employees in other sectors such as Central/State Government, RBI, LIC, GIC, etc., do not have access to a similar pension scheme extension. The IBA will now work on finalizing the details and instruct the banks to offer this option to eligible resigned employees and officers.
