Letter to IBA by Canara Bank Retirees

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Sep 26, 2010, 10:40:53 PM9/26/10

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Letter to IBA by Canara Bank Retirees

To 9^th September 2010

The Chairman

Indian Banks’ Association

World Trade Centre Complex

6^th Floor, Cuffe Parade

MUMBAI- 400 005

Dear Sir,

SUB: Our Retirement from Canara Bank under VRS as per Canara Bank Officers’ Service Regulations (CBOSR) 1979

In terms of Regulation 19(1) of Canara Bank Officers’ Service Regulations 1979, a scheme for Voluntary Retirement for Officer- Employees was introduced in Canara Bank and communicated vide its Cir No 160/86 dt 24.04.1986.

As per this Regulation it is stated that “nothing in Regulation 19(1) shall preclude an officer employee from retiring earlier pursuant to the option exercised by him in accordance with the rules of the bank”. The CBOSR is approved by the Government.

Therefore, in terms of the Govt Approved VRS scheme of Canara Bank, all of us after completing two or three decades of blemishless service in the Bank opted for VRS for various reasons duly complying the rules prescribed in this regard as per Pension Regulations 1995. In effect, we have complied with the rules of the Pension Regulations though at that time 2^nd option for pension was not envisaged to the PF optees.

Extending 2^nd option for Pension to PF Optees was a long pending issue which was settled in the 9^th Bi-partite settlement as per the Joint Note dt 27.04.2010 between IBA and Officers Associations.

The sequence of events that led to the present stalemate is detailed hereunder for your immediate reference:

01. MOU dt 27.11.2009 between IBA and Officers Associations (Copy enclosed)

As per para 2(i) of MOU dt 27.11.2009, it was agreed that “ those employees who were in the service in the bank as on 29.9.1995/26.03.1996 who were eligible but did not opt for pension and retired thereafter shall also be extended the option for Joining the pension scheme subject to (a) & (b)”

Therefore, as per MOU, agreement was reached to extend option to the retirees to opt for pension.

Further, the MOU specified that “ the parties will meet on mutually convenient dates to draw out a detailed Memorandum of settlement/ Joint Note…….. and finalize the same within a period of 90 days from the date of this Minute”

02. Meeting dt 09/10. 12.2009 between IBA and UFBU ( UFBU Circular NO. 26/48/2009/43dt 10^th December, 2009 is enclosed)

Further to the signing of the MOU on 27-11-2009 on wage revision and pension option, on 9-12-2009, a round of discussions took place between IBA and UFBU. IBA’s team was led by Mr. Allen Pereira, (CMD, Bank of Maharashtra) and Vice Chairman of their Negotiating Committee. From the UFBU, all the 9 constituent unions participated in the Talks.

During this meeting, the broad approach to expeditiously finalise the full settlement was discussed. It was decided that construction of new pay scales, revision of allowances, drafting of the Settlement, etc. would be taken up in subsequent meetings to be held separately with the 5 Workmen Unions and 4 Officers Associations.

It was further decided that the drafting of the settlement on wage revision and pension option be simultaneously undertaken so that both the settlements can be signed together.

Arising out of the Minutes on Pension Option,

“it was mutually clarified and understood that ‘RETIREES’ would mean and include Employees/Officers who have Retired on normal Superannuation, those who have Retired under VRS/Special VRS and families of the PF optees who had died during the period all of whom would be eligible for the pension option. Issues like cut off date, formula for sharing of the additional cost of pension option, etc. were taken up and would be discussed further”.

Therefore, it was agreed between IBA and UFBU to include Officers Retired under VRS also for providing Pension option.

In other words, Officers Retired under VRS of banks are made eligible to opt for Pension as per the MOU dt 27.11.2009 and subsequent agreement on 09.12.2009.

03. Meeting with Hon,ble Finance Minister on 13.04.2010:

Pursuant to the MOU dt 27.11.2009 and subsequent discussions, IBA and UFBU leaders met the Hon’ble Finance Minister on 13.04.2010, who consented for implementation of the settlements agreed between IBA and UFBU and reportedly advised both the parties that the Pension payment be made effective from the date of MOU i.e 27.11.2009.

Thus consent of Hon,ble Finance Minister was obtained among other things, to extend pension option to all the Retirees including those who have gone under VRS of the banks(as decided in the IBA/UFBU meeting of 09.12.2009).

04. Joint Note dt 27.04.2010 between IBA and Officers Associations

IBA in the Joint Note dt 27.04.2010 clearly states and acknowledges that “the parties held various rounds of discussions in the matter and have now reached conclusions as set out hereunder”

The above statement of IBA clearly confirms that the Joint Note dt 27.04.2010 has emerged on account of:

(i) MOU dt 27.11.2009 between IBA and UFBU

(ii) Various rounds of discussions between IBA and UFBU including the agreement reached by them in their meeting of 09.12.2009 whereby Retirees are also included.

(iii) Consent obtained from Hon,ble Finance Minister on the MOU and further rounds of discussions between IBA and UFBU

Para No 3(a) of Joint Note spells out the eligibility criteria for exercising Pension option. It reads “were in the service of the bank prior to 29^th September 1995 in case of nationalized banks/26^th March 1996 in case of Associate banks of SBI and Retired after that date and prior to the date of the Joint Note”

All of us were in the service of Canara Bank on 29^th September 1995 and Retired prior to the date of the Joint Note dt 27.04.2010. Therefore, all of us are eligible to opt for Pension as per para 3(a) of Joint Note.

05. IBA Circular CIR/HR&IR/G2/665/90/2010-11/999 DT 10.08.2010,

In terms of the aforesaid IBA circular, among others, it clearly states that “Government has consented IBA to advise banks for seeking option from the employees both serving and RETIREES who did not opt for Pension earlier, explaining the terms and conditions for such Option”.

It is very clear that the Govt has consented for offering one more option for Pension to the Retirees who had not opted earlier.

In terms of Para No 3 of aforesaid IBA circular, Government has accorded sanction to implement the terms of settlement as per Joint Note dt 27.04.2010 for the grant of option to the Retirees and payment of pension to such Retirees w.e.f 27.11.2009, who opt for pension and comply with the terms and conditions set out in the settlement/ Joint Note for the grant of Pension.

Therefore, Govt has accorded permission to IBA for extending Pension Option to all the Retirees as per the Joint Note dt 27.04.2010.

In effect, all Retirees without any QUALIFICATION are entitled to opt for Pension.

06. Contradiction in IBA Circular dt 10.08.2010 with that of the Joint

Note dt 27.04.2010

As per Para No 3 of the IBA circular dt 10.08.2010, IBA has obtained the consent of the Govt for implementation of the Pension scheme. In this para, nowhere the word SUPERANNUATION is used.

However, under Para No 13 (page 2) IBA states “ …….. in terms of Joint Note dt 27.04.2010 Officer Employees who ceased to be in the service on account of retirement on SUPERANNUATION are eligible to opt for joining the pension scheme now as retired employees subject to the terms and conditions stipulated.

Therefore, it is clear that while obtaining the permission from the Govt, IBA has not included the word “Superannuation” and only under para No 13 it is for the first time IBA used the word “Superannuation”.

In effect, IBA has arbitrarily put this word without the permission of the Govt to create avoidable confusion and contradiction to only delay implementation of the pension settlement.

This can be further corroborated by the following acts of IBA:

IBA PRESS RELEASE dt 27.04.2010:

In terms of this Press release, another option of pension is given to all existing employees who did not opt earlier and also who have retired/died after pension regulations 1995/96.

IBA PAPER AD/ NOTICE TO THE RETIRED EMPLOYEES TO OPT FOR PENSION:

IBA’s notice to all the Retirees to opt for joining the Pension scheme appeared in all the major newspapers of the country. The entire notice carried eligibility criteria linked to the Joint Note dt 27.04.2010. Nowhere in this Notice the word “Superannuation” is used.

In fact, Joint Note Para No 14 reads “any difference of opinion regarding interpretation of any of the provisions of this Joint Note, the matter will be taken up at the level of IBA and the Officers’ Association for discussion”

IBA without discussing this issue with Officers’ Association has wrongly and arbitrarily incorporated the word “Superannuation” thus violating the sanctity of Joint Note and the Bi-partite settlement and also has misled the Govt as Govt permission is available for implementation of Joint Note dt 27.04.2010.

This is nothing but the breach of trust reposed by the Govt /UFBU on IBA.

07. DEFINITION OF “RETIREMENT” AND “SUPERANNUATION”

FOR THE PURPOSE OF PENSION OPTION.

(A): DEFINITION OF RETIREMENT:

Regulation 2(k) of Bank (Employees) Pension Regulations 1995 defines Date of

Retirement as “means the last date of the month in which:

- An employee attains the age of Superannuation OR

- The Date on which he is Retired by the Bank OR

- The DATE ON WHICH THE EMPLOYEE VOLUNTARILY RETIRES or

- The Date on which the officer deemed to have Retired.

Therefore, it is very clear that as per Pension Regulation 1995, Retirement also

includes employees who have gone under VRS

Regulation 2(y) of Pension Regulations 1995 defines Retirement as:

(a) On attaining the age of Superannuation specified in the service regulations

(b) ON VOLUNTARY RETIREMENT IN ACCORDANCE OF THE PROVISIONS CONTAINED IN REGULATION 29

(c) On premature Retirement by the Bank before attaining the age of Superannuation

Under Regulation 2(y) also it is very clear that Retirement includes VOLUNTARY RETIREMENT as per the provisions of Regulation 29.

Regulation 29 of Bank (Employees) Pension Regulations 1995 states about Pension on Voluntary Retirement:

(1) ……….. at any time an Employee has completed 20 Years of qualifying service by giving notice of not less than 3 months in writing to the Appointing Authority to Retire from service.

(2) The Notice of Voluntary Retirement shall require acceptance by the Appointing Authority

FROM THE PENSION REGULATIONS IT IS VERY CLEAR THAT OFFICERS WHO HAVE GONE UNDER VRS SCHEME OF THE BANK HAVING COMPLETED 20 YEARS OF SERVICE ARE ENTITLED FOR PENSION.

(B): DEFINITION OF SUPERANNUATION:

(i) Regulation 2 of Bank (Employees) Pension Regulations 1995 defines various terminologies of the Act.

Nowhere under this Regulation, the word” Superannuation” is defined like other terminologies.

However, Regulation 2[y(a)] while defining the Retirement mentions that “on attaining the age of “Superannuation” specified in the Service Regulations or Settlements”.

On a detailed perusal of Officers’ Service Regulations (OSR), nowhere the word ” Superannuation” is found. In other words, it is not there in the entire OSR.

However, under Regulation 19 of OSR, while mentioning the AGE OF RETIREMENT it is stated:

The age of Retirement of an Officer Employee shall be as determined by the Board in accordance with the guidelines issued by the Govt from time to time.

Provided also that nothing in this regulation shall be deemed to PRECLUDE an Officer Employee from Retiring earlier pursuant to the Option exercised by him in accordance with the Rules in the Bank.

FROM THE ABOVE IT IS ABUNDANTLY CLEAR THAT “SUPERANNUATION” MEANS AND INCLUDES :

- Officers retired in accordance with Govt guidelines

- And also those Retired under Voluntary Retirement Scheme of the Bank in accordance with the Rules in the Bank.

IN OTHER WORDS, ALL THE OFFICERS WHO HAVE OPTED FOR VRS AFTER COMPLETING THE REQUIRED NUMBER OF YEARS OF SERVICE IN THE BANK AND DULY COMPLYING WITH THE RULES OF THE BANK HAVE ACTUALLY RETIRED OR SUPERANNUATED.

Hence, even if interpreted that para no 13 of IBA circular dt 10.08.2010 mentions retirement on account of Superannuation, Officers under VRS are covered by the same and hence eligible to opt for pension as per joint note dt 27.04.2010 and IBA circular dt 10.08.2010.

FROM ALL THE ABOVE LEGALLY TENABLE FACTS IT IS VERY CLEAR THAT OFFICERS UNDER VRS OF THE BANKS ARE ELIGIBLE TO OPT FOR PENSION BASED ON JOINT NOTE DT 27.04.2010 AND IBA CIRCULAR DT 10.08.2010.

08. Where Officers under VRS have been reckoned for the purpose of computation of Load Factor by Actuaries:

As per the format devised by IBA/ Actuary, banks were advised to furnish information relating to both Serving and Retired Employees as on 31.03.2008 as under:

- Number of Serving Employees who are PF Optees as on 31.03.2008

- Names of the Retired Employees and the Banks PF contributions in respect of

each of them.

Each bank has furnished the above information. Therefore, every employee of the bank either serving or retired as on 31.03.2008 has been reckoned for computing the Load factor and hence VRS optees should be given the opportunity to opt for pension.

09. PROVIDING OPPORTUNITY TO RETIREES UNDER SVRS AND CREATING DISCRIMINATION AMONG RETIREES;

As per Joint Note dt 27.04.2010 and IBA circular dt 10.08.2010, opportunity has been provided to Retirees under SVRS to opt for Pension. The ridiculous part is that Option is allowed even to those SVRS Officers who had just completed only 15 years of service as against the minimum required Pensionable service of 20 years as per Pension Regulation 29, whereas the option is not provided to Officers who have retired under VRS after completing more than 30 years of unblemished service.

Banks and IBA were generous to launch SVRS in 2001 and allowed Officers to prematurely Retire by offering a very BIG BOOTY of Advance salary for the remaining years of service subject to a maximum of 5 years.

Each of the SVRS Retiree at an young age got a huge Purse from the bank that too in 2001 when the value of money was good and the bank Deposit interest rates were good.

In respect of already Pension Optees, they got the Double benefit, in terms of 5 years Advance salary by way of Golden shake hand and also started drawing pension from the first day of their Retirement. It meant that, these Retirees got both Salary and Pension for the first 5 years of their Retirement from the very day of their Retirement.

WHEREAS BANK AND IBA ARE TRYING TO EXCLUDE HONEST RETIREES WHO HAVE OPTED FOR VRS AS PER BANK SCHEME WITHOUT GETTING EVEN A SINGLE PAISA BENEFIT FROM THE BANK APART FROM NORMAL ENTITLEMENTS.

From the above, it is very clear that IBA has taken partisan attitude and stand in providing extra benefits to SVRS optees by bending laws to accommodate them and leave out deserving and Legally eligible Retirees.

THIS IS THE HEIGHT OF DISCRIMINATION AND INFRINGMENT ON THE RIGHTS OF RETIREES UNDER VRS AS CONFERRED IN OUR CONSTITUTION.

The Discrimination in allowing Pension Options to Retirees have been strongly condemned by several Courts including the Supreme Court in the past in various cases filed by aggrieved Retirees at different points of time and BOTH THE CONCERNED BANK AND IBA HAVE BEEN STRONGLY REPRIMANDED FOR THIS

Both the IBA and the concerned banks are very well aware of these facts and the records are very much available with them.

For the ready information, certain decided cases where Courts have held a strong condemnation views against IBA and Banks for creating discrimination while awarding the verdict in favour of the aggrieved Retired employees of the Bank are furnished hereunder ( few select paragraphs are furnished):

(a). Canara Bank Vs B.M. Ramachandra & others, Judgment by Sri.R.P. Sethi, Hon,ble Chief Justice, High Court, Karnataka on 30.05.1997

“ It is acknowledged principle of interpretation and the rule of construction that if any impugned action is reasonably capable of construction which does not involve the infringement of fundamental rights, that construction must be preferred …….. Applying such a test in the present case it would be seen that if the interpretation sought to be put by the appellants is accepted, the same would amount in violation of fundamental rights of equality as enshrined in Articles 14 and 16. If the construction is assumed in favour of the employees, the SAME WOULD NOT RESULT IN THE VIOLATION OF ANY RIGHT MUCH LESS A FUNDAMENTAL RIGHT…………..

Having regard to the facts and circumstances of the case, and the position of law as noted herein above, it can be safely held that the REGULATIONS WERE INTENDED TO BE MADE APPLICABLE TO ALL THE VOLUNTARILY RETIRED EMPLOYEES NOTWITHSTANDING THE CUT OFF DATE”.

“ It is now well settled that Pension is granted in lieu of long service rendered by an employee and considered as deferred portion of compensation for past service. IT CANNOT BE TERMED TO BE A CHARITY OR BOUNTY NOR IS GRATUITOUS PAYMENT SOLELY DEPENDENT UPON THE WHIM OR SWEET WILL OF THE EMPLOYER. In a democratic country like India, its origin is referred to SOCIAL SECURITY plans which are CONSISTENT with the SOCIO ECONOMIC REQUIREMENTS OF THE CONSTITUTION. ………………………………………….”

“ It is held that the persons like the writ petitioners were entitled to the pensionary benefits on account of the services rendered by them upon satisfaction of the conditions specified in the Regulations and that grant of such pension was neither a concession nor a charity or bounty”.

The Judgments refers to the various cases and a landmark Judgment of Supreme Court is quoted by the Hon,ble Chief Justice while delivering the Judgment as under:

A constitutional Bench of Supreme Court in Nakara,s case( D.S.Nakara & others Vs Union of India.

“ With the expanding horizons of socio economic justice, the Socialist Republic and Welfare State which the country endeavors to set up and the fact that the old men who retired when the emoluments were comparatively low are exposed to vagaries of continuously rising prices, falling value of rupee, inflationary inputs, BY INTRODUCING ARBITRARY ELIGIBILITY CRITERIA THEREBY DIVIDING A HOMOGENEOUS CLASS, THE CLASSIFICATION BEING NOT BASED ON ANY DISCERNABLE RATIONAL PRINCIPLE AND BEING WHOLLY UNRELATED TO THE OBJECTS SOUGHT TO BE ACHIEVED BY GRANT OF LIBERALISED PENSION AND THE ELIGIBILITY CRITERIA DEVISED BEING THOROUGHLY ARBITRARY…. VIOLATES ARTICLE 14 AND IS UNCONSTITUTIONAL AND LIABLE TO BE STRUCK DOWN”

The Judgment also refers to the All India Reserve Bank Retired Officers Association’s case where the Supreme Court again relied upon Nakara’s case and held that:

“ If the choice of the date results in classification or division of members of homogeneous group it would be OPEN TO THE COURT to insist that it be shown that the classification is based on an INTELLIGIBLE DIFFERENTIA and on RATIONAL CONSIDERATION which bears a nexus to the purpose and object thereof. The differential treatment must be justified on the touchstone of Article 14 FOR OTHERWISE IT WOULD BE OFFENSIVE TO THE PHILOSOPHY ENSRINED IN THE CONSTITUTION”

10. IBA’s Clarification to Canara Bank:

Whether IBA is authorized to clarify:

As per Joint Note dt 27.04.2010 Para No 14 “ any difference of opinion regarding interpretation of any of the provisions of this Joint Note, the matter will be taken up at the level of IBA and the OFFICERS’ ASSOCIATION FOR DISCUSSION”

It is understood that Canara Bank had sought some clarification from IBA about the eligibility for opting for Pension and IBA had reportedly clarified that VRS optees are not eligible.

IBA without discussing this matter with Officers’ Associations has wrongly clarified as above without reference to either Pension Regulations OR Officers’ Service Regulations and thus discriminated the homogeneous group. Also, IBA has violated the sanctity of Joint Note and the Bi-partite settlement and also has misled the Govt as Govt permission is available for implementation of Joint Note dt 27.04.2010.

HENCE THE REPORTED CLARIFICATION GIVEN BY IBA IS ULTRAVIRES THE JOINT NOTE DT 27.04.2010 AND TO BE STRUCK DOWN.

In fact, AIBOC in its letter dt 28^th August 2010 addressed to IBA has strongly criticized the discriminatory attitude of IBA and condemned IBA for unilateral violative and discriminatory stand taken by them. Similarly, All India Banks’ Officers Association (AIBOA) has also strongly condemned the action of IBA in its letter addressed to them

All these clearly confirms that AIBOC and AIBOA representing nearly 99% of Officers of the banks in the country have strongly opposed to IBA makes it clear that IBA clarification is ultravires the Joint Note and hence should be summarily rejected.

FROM A DETAILED ANALYSIS OF ALL THE ABOVE, IT IS VERY CLEAR AND LEGAL THAT OFFICERS UNDER VRS AS PER OSR BE GIVEN THE OPTION FOR PENSION AS PER JOINT NOTE DT 27.04.2010.

Considering all the above, we humbly request you to suitably advise the banks to permit Officers Retired under VRS also to opt for Pension.

We are thankful for your patience in reading this lengthy letter.

We are sure that you will consider our request based on the above position for which, we shall ever remain grateful to you Sir,

Thanking you

Yours faithfully

Sd/ Retired Officers under VRS of Canara Bank as per Annexure

S.R. Bekal

2208, V Main, 23^rd Cross

II Stage, Banashankari

BANGALORE- 560 070

Ph No: 09845843477

Annexure to the Letter Dt 10.09.2010

Retirees under VRS of Canara Bank

Sl No	Name	Signature

Annexure to the Letter Dt 10.09.2010

Retirees under VRS of Canara Bank

Sl No	Name	Staff No	Signature

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Letter to IBA by Canara Bank Retirees

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