Why Are Public Sector Banks Closed Today? Here’s What You Need to Know

Synopsis: On January 27, the operations of public sector banks in India were affected by a nationwide strike called by bank unions, demanding a five-day working week. SBI warned of the possibility of being affected, while the unions clarified their alignment with RBI, LIC, and government offices and also provided additional working hours on weekdays.

The operations of public sector banks in India were hampered on January 27 as bank unions called a strike in support of their demand for a five-day working week. The strike came after banks were shut on Sunday and Republic Day, causing concern among customers. Although SBI made efforts to ensure that everything was normal, it warned that services may be impacted as employees joined the strike.

Public Sector Banks to Experience Nationwide Strike

Public sector banks in India are expected to experience major operational disruptions on January 27, as bank unions have announced a nationwide strike in a bid to ensure that a five-day workweek is adopted. Although private sector banks are expected to operate normally, public sector banks may experience disruptions for the third consecutive day, after being shut down on January 25 (Sunday) and January 26 (Republic Day). This may be a major setback for millions of customers who rely on public sector banks for their daily banking needs.

The Core Demand: Five-Day Workweek

The demand for a five-day workweek was first put forth in March 2024, during wage revision talks between bank unions and the government. The United Forum of Bank Unions (UFBU) suggested that all Saturdays should be declared bank holidays, as banks are already like RBI, LIC, GIC, stock exchanges, and government offices, which operate on a five-day workweek. The UFBU feels that there is no reason why banks should function differently in the current digital and automated age.

Operational and Customer Impact

Though the State Bank of India has clarified that it has made necessary arrangements for normal functioning, it has also accepted that there might be some impact due to the strike. If the strike is completely implemented, customers may experience some delay in branch-based operations like cash transactions, cheque clearance, and documentation work. This might further put more pressure on online banking and ATMs.

Union’s Productivity Offer

To address the issue of reduced working hours, UFBU has offered to work for 40 minutes extra every day from Monday to Friday, which would offset the Saturday working hours and result in no loss of man-hours. This indicates that the unions are trying to present the demand not as a labour concession but as a work pattern realignment, as per the latest organisational trends.

Policy Implications for the Government

The strike again brings into focus the need for the government to address the pending labour reforms in the banking sector. Failure to do so may result in frequent strikes, which may have a negative impact on customer confidence and efficiency in PSU banks. The government’s response to the strike may set a precedent for future labour policies in the financial services industry.

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