By Charindra Chandrasena
While most banks have considered salary cuts following the footsteps of leading conglomerates and several institutions, they are unlikely to implement them due to the strong employees’ union in the banking sector of the country, The Sunday Morning Business learns.
According to the Ceylon Bank Employees’ Union (CBEU), 18 banks in the country have entered into collective agreements with the CBEU individually and these collective agreements specify time frames of salary increments and bonuses, leaving no legal room for the banks for salary cuts.
“These collective agreements do not have any exceptions for pay cuts. If at all, it is only bonuses that can be cut, but even that has already been given this year. It is a secured payment and they are bound to pay in the agreement,” CBEU Vice President Dinuka Samaranayake told The Sunday Morning Business.
The CBEU is the single largest trade union operating across the banking sector of Sri Lanka. It has a presence in 18 out of 33 banks operating in the country with a membership exceeding 28,000, or more than 50%, of the country’s banking professionals.
Therefore, the CBEU believes that bank employees will not be subjected to salary cuts amidst the prevailing pandemic and its impact on economic activities of the country. This has also been supported by the fact that the banking service, which was not an essential service earlier, has been made an essential service during this curfew period.
“Staff are reporting to work despite holidays. They worked on Good Friday too. We believe they should not suffer with pay cuts,” he added.
According to Samaranayake, even though there is a threat of a salary cut in the future due to the increased cash outflows from the banks as opposed to the inflows, it is most unlikely that it will happen due to the agreement, and the CBEU is yet to decide what should be done in case the banks resort to salary cuts.
Further, he noted that regardless of the efforts put by the banking sector, the media has been unfairly portraying banks as villains and profiteers at a time when banking staff are helping the economy to keep moving forward, as requested by the Government.
Meanwhile, Dharma Dheerasinghe, Chairman of Commercial Bank of Ceylon PLC, the largest private bank in Sri Lanka, told The Sunday Morning Business that in case of having to take a decision to slash the salaries, they would first have to negotiate with the trade unions and come to a bilateral decision.
“There are agreements valid for three years. These bilateral agreements have been signed between the bank management and trade unions. Therefore, it cannot be a unilateral decision,” Dheerasinghe noted.
Under the collective agreements, bank employees receive salary increments for three years on a particular sale agreement. The banks’ remuneration framework is revised once in three years, incorporating the provisions of the collective agreements signed with trade unions.