Tuesday, November 1, 2011

Khandelwal Committee recommendations!

Instead of the current industry-level arrangement, the entire wage decision should come to the bank level, the Committee on HR issues in PSBs, headed by the former Bank of Baroda Chairman and Managing Director, Dr Anil Khandelwal, has suggested.
The suggestion to do away with industry-level wage settlements is in line with the overall approach of the committee that there cannot be one-size-fits-all solutions, whether it be for remuneration, incentives, welfare or according navratna status, Dr Khandelwal told reporters here.


 §            To be an annual well-structured and rigorous exercise for 5 year period,                                    factoring gaps in skills and competencies.
 §               Banks to monitor staff costs and endeavor to achieve staff cost ratio of 50% in the next 5 years;
 §                      PSBs to outsource non-core activities;
 §                   To implement Business Process Re-engineering(BPR) and Change Management.
 §                   PSBs to reach Officer-clerk ratio of 1: 0.5 for metro and         urban branches & 1: 0.75 for rural and semi-urban branches in next 3 years.
 §                    Recruitment of direct officers to be 50% of total officer         vacancies;
 §                     Entry qualification for clerical recruitment to be graduation;                for sub-staff, X standard pass.  Standard of recruitment of new clerical and officer staff to be raised in tune with the new requirements.
 §                   Fresh recruitment of clerks to be restricted to rural and semi-         urban branches; rural service to be made mandatory for new clerks.
 §                       Banks to incentivize mobility of clerical staff to rural areas;

                     New dispensation for training called for – Training system to focus            on creation of talent pool in critical areas.
                     Greater focus to be given to women and staff in rural areas.
                    E-learning to be extensively used.
                     Role related training to be compulsory for executives in Scale IV  and above.
                    External and overseas training to be aligned to talent management strategy.

                 CAREER PLANNING :
                    Officers to be provided well rounded exposure in banking operations before entering Scale IV.
                     Present mandatory rural service for officers to be continued.
                     Promotion process to be vigorous and methodology to include                 modern tools.
                     System to be put in place for identifying star performers and tracking their performance.
                     Special HRD efforts to be in put place for development of women and SC / ST employees.
                   Sabbatical leave of 2 years to be allowed at request to women  employees;

                              PERFORMANCE MANAGEMENT :
                     Promoting high performance culture across the organization to be the objective – Performance Management System (PMS) to be a credible, transparent and interactive system covering all categories of staff – including workmen staff.
                     Discipline of PMS to be enforced – Appraising authorities to be accountable for proper and timely assessment.
                     360 degree feedback system to be introduced for Scale IV and above.

                                Reward Management :
    £  Broad contours of the principles that may govern the performance –     linked incentive schemes of PSBs:
                     The incentive scheme should aim at performance differentiation and reward the pivotal employees.  This is with a view to retain employees in critical areas and build future leadership pipeline.
                     Total amount of incentive to be paid by a PSB in a year not to exceed 2% of its average net profit earned over the previous two years.
                    Incentive to be limited to 25% top performers who are covered under PMS.
                    The Committee further recommends that in tune with market trends, PSBs may consider offering Employee Stock Option Plan (ESOP), in the future, as a measure of promoting ownership in the employees as also retaining talented workforce.  This is to be limited to 15% top performers in the executive cadre including CMDs and EDs.

     Succession Planning and Leadership Development :
                     Succession planning to be introduced for identified critical and leadership positions – Each position to have 3 persons in the reserve.
                     Comprehensive leadership development strategy to be developed for Scale IV and above.
                     Modern HRD tools like Assessment Centre and 360 degree feedback to be used for potential identification.
                     A common pool of GMs in the industry to be created for future ED / CMD positions.
                     Bankers’ Leadership Development Institute (BLDI) to be set up for creating future leaders, research, benchmarking, best practices, etc.

                     Large banks to be provided ED (HR) to drive HR agenda from the top.
                     A steering Committee of the Board on HR to be constituted to discuss critical HR issues.
                     A Monitoring Group to be set up at the Ministry for monitoring HR transformation agenda in PSBs.
                     HR professionals to be recruited at senior and junior levels.
                     HR administration to be automated through web-based system.
                    HR audit to be introduced.
                   Award to be instituted for best HR practices.

                     PSB Boards to decide on bank-specific wage and compensation structure, in relation tocapacity to pay, profitability, productivity, etc. and strictly within the overall guidelines of the Government in this regard.
                    Banks to consider variable pay as a major component of wages.  In such an arrangement, banks to have the discretion to go in for Cost-to-Company (CTC) concept.

                         INDUSTRIAL RELATIONS :
                     PSBs to revisit and review all internal settlements that affect mobility, flexible utilization of staff, productivity, performance and customer service.
                     Bank managements to accord priority treatment to the issues of productivity and performance acceleration while dealing with IR issues.

The UFBU decided to outrightly reject these anti-employee, anti-trade union recommendations and further decided that if there is any attempt to implement the same by the Government or the IBA or by any of the Banks, the same would be opposed through organisational programmes including strike actions.


Unknown said...

UFBU's stand is right & correct.

Kamlesh Chaturvedi said...

I wish you all the best in your sincerest efforts to awaken Bank Employees. Please continue expressing yourself freely.


Some recommendations are already being implemented through back-door . Although , most of these will make PSB s more competitive vis-a-vis Private sector banks .

Anonymous said...

I am in SBI and as a Banker having experience of more than 10 yrs,am wonwering why the association is against such reforms, whats wrong with the report i dont understand if any one can clarify,
1. Why the bank should not recruit 50% in officer cadre means whats the harm? its the gen practice even in govt, 50% direct and 50% by promotion.
2. Why afraid of variable pay, by going against this and CTC concept are we not protecting the Kaamchors, and disheartening sincere workers.
3. HR is the worst managed area in public sector Banks, it needs some serious reforms, why we are going against, i am unable to understand.
Arvind Kumar SIngh
SBI Bhopal.

Avinash said...

Nice to update myself on Khandelwal Comm report. eed to educate complacent bank employees about it. Pl contunue to educate bank employees about their rights as well as their responsibilities to face the compitition from pvt sector. Avinash Thane

amit said...

it is my pleasure to comment on this.
dont anyone think that if this will be implemented then where will the corruption level rise and in this highly inflation country what will be the condition of 7 lakhs employee who are in middle/junior level.
just think!
amit agarwal

Anonymous said...

I am SBI Banker and have experience of more than 25 years in banking industry. I condemn the recommendations of Khandelwal Committee Report.

Anonymous said...

I agree with Khandelwal recommendation regarding HR as it is the worst area in banking industry -Mukesh Saini SBI Officer RASMECCC,Amritsar

Anonymous said...

I totally agree with the recommendations of khandelwal Committee The union should think of the young generations once before opposing the recommendation straight away!!!
Ayush Pandya
Allhahabad Bank

sayan bhattacharjee said...

HR is the worst mamaintained part in most publik sector banks.I feel the need for better handling of this department through recruitment of trained HR professionals.I also feel that non core jobs like ATM handling ,cash remittance and security be outsourced.
sayan Bhattacharjee
Syndicate Bank
Port Blair

Anonymous said...

I am in SBI, I strongly oppose the committee report, instead if the govt or the IBA is thinking about the sincere effort of the employees they should give proper eye on the work and the performance of the employee on that's basis only they should give promotion or give some remunarations to encourage the work. There is strongly no need of CTC this is not anyone's jaagir

Anonymous said...

I am in SBI, I really think that these recommendations should be implemented in every banking level......The protests are mainly coming from those people who always has the tendency to avoid the work and pass the time with doing nothing by the help of so called Great UNION...... a fear started in their mind that if it is implemented then they have to work for CTC.... other wise that will be a loss.....

A strong HR policy as well as HR professional is required for the bank.......

it is no ones 'jagir' but every ones SERVICE place......specially for DADA and their good for nothing followers.

N RAMIAH said...

I strongly oppose KC recommendations. Variable Pay is very dangerous. It leads employees to be a bonded labours to the Management. Management will fix more pay to yes-men than the hard working man going straight. The ration 1 : 0.5 reveals that in future a clerk should work in cash department only. After their retirement even that work may be given to outside agency. ESOP and allowing top management to have 15% shares will lead to privatisation and poor management will lead to bankruptcy.

Anonymous said...

Even though some of the recommendations are appears to be good, i am on the opinion that variable pay leads to bossisam and favoratisam in the banking industry, which is suicidial step for the banking industry. We all know that there is no HR policy in the PSB"s and right person at right place posting is mere dream in present PSB's. Most of the decisions are being taken by Non HR persons based on bias and not at all in the interest of the organisation.

Anonymous said...



Anonymous said...

Ye top govt. Neta aur aur govt officer apni salary to 25000 se 1 lakh ker li aur sari govt.schme bank walo se batwate hai iba jo ki govt. Ka dalal hai wo sabhi bank employee ko bevkoof bana rahe aaj bees salo se sarkari bank employee jo ki raat dus baje tak kam karta hai usko bahootme ghar chalana parta hai meri sab bank employee ko kasam hai ki wo upa govt. Ko vot na de

Anonymous said...

I am from Bank of Baroda and I am strongly in favour of Khandelwal committee recommendation.
People who do not work,get comfort at the cost of others are opposing it.Professional guys should never oppose it.
Aspiring to compete with the best with the old fashioned way is not going to work as we have to accept today's reality.
Remember Public secor banks were compelled to adopt technology as they were running out of business,similar thing will happen for talent when new banks come in.
Have a forward looking approach,when so much retirements are there in next 3-5 year.

Saikat said...

I am in SBI and I have a mixed feeling regarding this report. It is true that HR is worst are in PSBs there should be some transparency in promotion placement and posting. Wage revision is another area to be focused otherwise the recommendations will sound like empty vessel very few professional guys will work in this salary structure and presently CTC concept is there in every new recruitment ads. another important area is NON CORE activities. Canteen service may be a non core activity but I dont think ATM replenishment or even Security at branch premises should be outsourced

Anonymous said...

Yes, I too am in SBI, joined almosed two decades back as a direct officer, but as usually happen everyone is not equal in practice in India; more so everyone do not has god father in the form of individuals or castial relations, so is in my case and result isnon-performers superceeded me in career progression. After KC recommendations implementation I trust such discremination shall be done away. Moreover, it is an age of new and energetics so let oldy give them way amicably or be them crushed.

An officer in SBI, Delhi Circle

Anonymous said...

Firstly, the salary structure needs to be revisited. My MBA Batchmates who joined with me in other PSUs are getting around Rs 65k whereas after promotion to MMG II in 4 years & with 6 years of service till date I am drawing a salary of Rs 35K. This is very serious,

Secondly, for variable pay, in last 6 years of service I have seen that people who do not take pains take all the gains & favour of authorities; after all who will determine that who is performing & non-performing. Again the same authorities. This will encourage more sycophancy in the existing pathetic working conditions & meager salary structure and would result in may be late sitting to extreme hours,

Thirdly, 50% direct recruitment in all scales is an eagerly awaited and welcome move. However, those bankers who have joined before 01.04.2010 will find no good reason to leave due to withdrawal of old pension scheme and introduction of new pension scheme. The New Pension Scheme is really a tasteless lollypop of Central Government, as they do not know the outcome of new pension scheme and yet there is no clarity over the returns. On the day of retirement if the stock market crashes then new pension scheme holders will be 'THAN THAN GOPAL' and will live post retirement life like a beggar. Even if, the return is assumed at 9% of FDR then at retirement, say after 30 years, we shall get monthly pension of around Rs 9K. The Central Govt. does not want to give social security to its citizens to manage the unmanageable fiscal deficit.

Fourthly, move on HR transformation is desperately required in Public Sector Banks, as the management has become blood sucker. HRD should however answer the following questions as well:
1. What about paternity leave to young male officers as is in Central Govt?
2. When will we assess the quantum of work and divide the same to the required number of officers to make the technology work efficiently. Even working on computers, ATM’s, CDM’s etc requires human beings. Of late we have developed multitude of software’s, have we ever assessed the manpower required to work on these software’s, man hours required to complete one activity?
3. What about 5 day’s week in Central Govt, RBI and other administrative blocks? When the officials of regulatory body need rest for 2 days out of 7 days of a week then we are also human beings. Ensure equal treatment to us also.
4. What about same place posting for Women. If reason is that they are fairer sex/ weak/ need support, then scrap Equal Opportunities Act, Scrap the movement for reservation for women as they don’t deserve it, scrap the promotion policy. Apply equal rules for all human beings

Well the list is endless. Above explains the 6 years of agony. At the time of my marriage my Chief Manager said that I should take 3 days leave, get married and join back and literally tortured during that once in a lifetime event. Should not that Chief Manager be hung till death?

Anonymous said...

good recomendations

Anonymous said...

I am in NABARD. Though recommendations do nott apply directly to NABARD, they are followed by the management more enthusiastically. But the present top brass have enjoyed every thing but now denying it to the present staff but taking care of their own position. The recommendations will definitely encourage psychofancy and corruption in promotion, placement etc.

Anonymous said...

what mechanism is in place at present to appraise the performance of an employee in Banks. this will lead to pre nationalisation era.

Anonymous said...

I strongly oppose

Unknown said...

kusumakar SBI


Anonymous said...

Well said Boss. We are also humans

Anonymous said...

donot fight. we are simply discussing but Govt will implement whatever they want bcz union has no bargain power to overcome this.

Anonymous said...

mr arvind kumar singh your experience is only 10years the call is given by the leadership
to a i b e a a mighty organisation with 60 years of experience with lucha managements once
see back why punjab and sind bank bank of maharastra which are on average lines but the
employees enjoy same salary the executives are appointed by Govt. by recommendation so the banks are very poor state there are many psb these banks are not nationalised for profits but to serve the poorest of poor and uplift but these executives give loan to rich and they dupe the bank one fellow is enough to dupe eg Indian bank they could not get wage revision for 2years incl da after the budget allocation and better management at lower and middle level they have recovered you are still a kid in bank better read union circular and know what khadelwala committee recommends

from b.h. sudarshan

Anonymous said...

The KHANDELWAL COMMITTEE RECOMMENDATIONS are anti-employees and anti-trade union. Any recommendations aimed at to weakening and destabilizing bank union is just not acceptable to any bankers. So need of the hour is to remain alert and in preparedness to thwart/resist any attempt of the IBA/Government to make any amendment in the Banking Regulation Act without discussing and taking unions' views/opinion. UFBU has taken a right stand in this regard.


FOR THE EXISTING LEADERS OF UFBU A Bankers’ Leadership Development Institute (BLDI) to be set up for creating future leaders, research, benchmarking, best practices, etc.

Anonymous said...

Its very interesting to read the Khandelwal recommendations. The salaries in the Banking Sector is one of the lowest in the country. I, would also like to know , What great shakes have been achived by Mr. Khandelwal to deserve , such a high salary & what is his productivity? It is very easy to recommend reforms for sectors not concerning the individual, probably we all can do so..I, think the Ministers , Beaureucrats should first do some introspection, and try to assess that, 'What great work have they accomplished to deserve such high salaries"? Their capabilities are known to all....Implementation of the Commitee recommendations will reuin the Banking sector in the long run. With such low salaries, difficult transfers in testing terrains & areas, round the clock responsibilities, six day workings unlike other government institutes with five days a week..no youth worth his salt will join the public sector banks. Mr. Khandelwal please wake up...& justify your salary first please, with due respects..

Anonymous said...


PRAKASH said...

There could be disagreement on some of the recommendations but the ways Unions are trying to project the Khandelwal committee report is nothing but shows the negativity & "WE WILL NOT CHANGE" attitude of leaders of the Unions. Just in the name of protecting rights of employees, Unions are only promoting and protecting "KAAMCHORS".
In my opinion, most of the recommendations will make PSB's more competitive and the strongest support for this should come from the younger officers.

Anonymous said...

I worked in a private MNC and am switching over to banking sector. People who have written favourable comments, welcoming the Khandelwal committee changes- you are all in for a rude awakening once systems like variable pay emerge. It is a brutal system which will only breed more shoe-licking. In MNCs, we have variable pay system, where in lesser performance (less performance does not mean non performance. this is on a relative scale)- there is a salary cut. A substantial 10K reduction in salary. How's that for starters?
Do you think HRs in PVT are "professional"? They are nothing but people who smile and speak the same language as management.

Think twice people... The grass is always greener... When the hell looks like a golf park-- they're recruiting-- remember that!