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8th Pay Commission Not Applicable to Bank Employees: Here’s Why?
The announcement of the 8th Pay Commission has created widespread attention among government employees across India. With expectations of salary hikes and pension revisions, the topic has remained in public discussion. However, a common question continues to surface: Will bank employees benefit from the 8th Pay Commission?
The short answer is no. Despite being employed in government-owned institutions, bank employees fall outside the purview of the Central Pay Commission. This article explains why the 8th Pay Commission does not apply to bank employees.
What is the 8th Pay Commission?
The 8th Pay Commission was approved by the Government of India in January 2025 to review and recommend revisions in pay, allowances, and pensions of Central Government employees and pensioners.
Although the implementation date was proposed as January 1, 2026, but it is likely to be delayed until 2028. As of now, the commission has not been formally notified, and neither the chairman nor its members have been appointed.
Why is the 8th Pay Commission Delayed?
The government has clarified that the delay is procedural rather than policy-driven. Inputs are still being collected from multiple stakeholders, including central ministries and state governments.
According to official statements in Parliament, the Terms of Reference (ToR) for the commission are under consultation. The notification will be issued only after all suggestions are reviewed, following which appointments to the commission will be made.
Who Will Benefit from the 8th Pay Commission?
According to official information, the 8th Pay Commission applies only to Central Government employees. Once implemented, it will also lead to revisions in the pensions of retired Central Government employees. Bank employees remain outside its scope.
Are Bank Employees Covered Under the 8th Pay Commission?
No. Bank employees are not eligible for benefits under the 8th Pay Commission.
Although public sector banks are government-owned, their employees are not treated as Central Government staff for pay revision purposes, as banking salaries are revised through bipartite settlements rather than pay commission recommendations.
How Are Bank Employees’ Salaries Revised?
Bipartite Settlement System
Bank employees’ salaries are determined through Bipartite Wage Settlements, not pay commissions. These settlements are negotiated between:
- The Indian Banks’ Association (IBA),
- Bank employee unions
This negotiation-based system ensures that salary revisions are aligned with the banking sector’s specific needs.
Why the Bipartite Settlement Model Exists?
Sector-Specific Salary Structure
Unlike central government employees, bank employees follow a salary revision system that operates independently of pay commissions. The bipartite settlement allows the banking sector to address its industry-specific requirements through negotiated agreements. These settlements take into account key factors such as:
- Industry-specific profitability
- Economic conditions
- Inflation and prevailing economic conditions
- Operational requirements specific to the banking industry
Salary revisions under this framework generally occur once every four to five years, ensuring periodic and structured pay updates for bank employees.
No Direct Link Between Pay Commissions and Banking Salaries
Central Pay Commissions are designed exclusively for central government employees. Public sector banks, despite government ownership, operate under banking regulations and commercial principles.
Therefore, pay commission recommendations whether from earlier commissions or the proposed 8th pay commission do not apply to banking staff, as their salaries are revised through bipartite settlements rather than pay commission frameworks.
Recent and Upcoming Salary Revisions for Bankers
Bank employees have already received salary revisions under the 12th Bipartite Settlement, which came into effect in 2024. The 13th Bipartite Settlement expected in the coming years. This settlement included:
- Increases in basic pay
- Dearness Allowance (DA) revisions
- Improved allowances and benefits
Autonomy and Additional Benefits for Bank Employees
Banking institutions enjoy operational autonomy, which allows them to design compensation structures that include benefits not available under pay commissions, such as:
- JAIIB/CAIIB qualification increments
- Performance-linked incentives
- Special allowances, leased housing, and medical benefits
These benefits are tailored to the nature of banking roles and are outside the scope of government pay commission frameworks.
Conclusion
While the 8th Pay Commission promises long-awaited pay revisions for central government employees, bank employees will not be part of this. Their salaries are governed by bipartite settlements, which offer a more flexible, sector-specific, and performance-aware approach to compensation.
Although the delay in the 8th Pay Commission has caused uncertainty among eligible employees, bankers can rely on their established salary negotiation framework to ensure timely and relevant salary revisions, independent of pay commission outcomes.
FAQs
Q.1. Does the 8th Pay Commission apply to bank employees?
Ans. No. The 8th Pay Commission applies only to Central Government employees.
Q.2. How are bank employees’ salaries revised if not through pay commissions?
Ans. Bank employees’ salaries are revised through bipartite settlements negotiated between the Indian Banks’ Association (IBA) and bank employee unions.
Q.3. What is a bipartite settlement?
Ans. A bipartite settlement is a negotiated wage agreement between the Indian Banks’ Association (IBA) and bank employee unions that determines salary revisions and allowances for bank employees.
Q.4. How often are bankers’ salaries revised?
Ans. Bankers’ salaries are generally revised once every four to five years through bipartite settlement agreements.
Q.5. When was the latest salary revision for bank employees implemented?
Ans. The latest revision was implemented under the 12th Bipartite Settlement, which came into effect in 2024.
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