Recent reports indicate the Indian government, through the Department of Financial Services (DFS), has directed public sector banks (PSBs) to proceed with crediting Performance Linked Incentive (PLI) payments for FY 2025, even as the issue remains under conciliation with the Chief Labour Commissioner (CLC).
Bank unions under UFBU have strongly opposed the DFS directive, labeling it discriminatory and a breach of the status quo agreed during CLC meetings on January 22-23, 2026.
The dispute ties into broader conciliation talks linked to demands like five-day banking, where unions claim DFS warned that strikes could impact PLI resolutions.
At least one PSB has already disbursed the PLI, defying ongoing labor authority proceedings.
Union Concerns
UFBU argues the revised PLI framework favors certain officer scales, violating bipartite settlements and prior conciliation agreements.
Unions issued a circular on February 12, 2026, flagging the government’s move amid active disputes before the CLC.
This escalation risks further unrest, as PLI was previously halted multiple times in 2025 on CLC orders pending bipartite reviews.
Background Context
PLI schemes for senior officers (Scale IV+) have been contentious since early 2025, with UFBU repeatedly seeking deferrals citing discrimination against lower scales.
CLC meetings in June and October 2025 directed no disbursals until unions and IBA finalize revisions, but recent govt action appears to override this.
Next steps remain unclear, with potential for escalated union action if the directive holds.
