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Though the five-day workweek for bank employees was expected to be implemented from December 2024, the proposal now seems to be taking longer as the final approval from the finance ministry remains pending.
While the IBA and bank unions have agreed on the five-day workweek proposal for bank employees, the final decision now lies with the government.
The long-debated proposal of introducing a five-day workweek for banks in India is gaining traction once again. Banking institutions have traditionally operated for six days a week, with alternate Saturdays off. Though the five-day workweek for bank employees was expected to be implemented from December 2024 as per speculations, the proposal now seems to be taking longer as the final approval from the finance ministry remains pending.
The Indian Bank Association (IBA), the apex body representing banks, has been discussing the possibility of a five-day workweek for several years. The idea has been proposed multiple times during negotiations between the IBA and the United Forum of Bank Unions (UFBU), which represents banking employees.
The primary rationale behind the proposal is to align India’s banking work culture with global practices, improve employee well-being, and enhance productivity.
Recent Developments
In December 2023, a memorandum of understanding was signed between the Indian Banks’ Association (IBA), which includes both government-run and private lenders, and bank unions. This agreement included a proposal for a 5-day workweek, subject to government approval.
Subsequently, on March 8, 2024, the 9th Joint Note was signed by the IBA and bank unions. The Joint Note, signed by IBA and the All India Bank Officers’ Confederation, outlined the transition to a 5-day week with Saturdays and Sundays off.
The government and the Reserve Bank of India (RBI) have also been brought into the conversation, as their approval is crucial for such a structural change.
While the IBA and bank unions have agreed, the final decision now lies with the government. The proposal will also be discussed with the Reserve Bank of India (RBI) as it regulates banking hours and interbank activities. There’s no official deadline announced by the government on that.
Impact on Customers
For customers, especially those in regions with limited digital banking penetration, a shorter workweek could mean longer waiting times and the need to plan visits to branches more meticulously. However, bank employee unions have assured that the 5-day workweek would not lead to a reduction in customer service hours. To ensure this, the timing will also be revised to extend working hours by nearly 40 minutes, apart from enhancing mobile and internet banking platforms.
Challenges to Implementation
While the idea is appealing, its implementation faces several hurdles:
1. Regulatory Approval: The RBI and the Ministry of Finance must approve the change before it becomes a reality.
2. Banking Operations: Maintaining uninterrupted banking services in a country as large and diverse as India is a logistical challenge.
3. Union Agreements: Employee unions and management need to find common ground on compensation, working hours, and other operational adjustments.
What Is The Practice Globally?
Globally, banks in countries like the United States, United Kingdom, and Australia already operate on a five-day workweek. This model has often been cited as a reason for Indian banks to adopt a similar system. However, the unique socio-economic conditions in India necessitate a carefully tailored approach.
What’s Next?
The IBA and UFBU are expected to continue their discussions, with further updates likely in the coming months.
Rupam Roy, general secretary of the All India Bank Officers’ Confederation, told news18.com, said, “We are in the process of finalising plans to initiate an agitation soon. We have also extended invitations to our affiliate unions/ associations of UFBU to join the movement. As of now, there is no indication from the government regarding the implementation of the five-day workweek.”
