Bank unions on Sunday (September 27, 2026) deferred their proposed three-day nationwide strike following a meeting with bank managements. The United Forum of Bank Unions (UFBU) issued a circular late on Sunday night, announcing that an understanding had been reached with the Indian Banks’ Association (IBA).

UFBU defers bank union strike

The UFBU had called for a three-day strike from September 28 to September 30, 2026, over four key demands: implementation of the agreed five-day banking week, keeping the unilateral Performance Linked Incentive (PLI) scheme in abeyance, bilateral modification of the PLI framework, and settlement of long-pending residual issues.

The UFBU, an umbrella body representing seven bank employees’ and officers’ unions, had also threatened to go on an indefinite strike from October 26, 2026, if its demands were not met. However, the forum decided to defer the proposed strike following progress in discussions with the IBA. The strike has not been cancelled, as the demands are yet to be met, with the IBA agreeing to constitute a high-level committee to examine the issues raised by the unions.

Committee for 5-day work week demand

One of the UFBU’s main demands is the implementation of a five-day working week in the banking sector, with all Saturdays declared bank holidays. In 2024, bank employees had suggested increasing daily working hours by 40 minutes to ensure that the total number of working hours per week remained unchanged. The proposal has been pending with the government.

The unions have argued that a five-day working week is already followed by several government and financial institutions. In a significant development, a consensus has now been reached on the immediate constitution of a high-level committee comprising representatives of the IBA and the UFBU to specifically examine the demand for declaring Saturdays as holidays.

“A high-level committee of the IBA and UFBU will be formed immediately to deliberate on the issue of declaring the remaining Saturdays as holidays. This committee will explore all possible alternatives, discuss with all the stakeholders, and work out a solution acceptable to all the stakeholders, more importantly, the customers,” the UFBU said in a statement.

PLI scheme kept in abeyance

Apart from the demand for five-day banking, the unions have sought the withdrawal of the PLI scheme announced by the Department of Financial Services in November 2024 and applicable for the financial year 2025-26. The revised PLI scheme was applicable only to officers in Scale IV and above, which became a major point of contention. Under the scheme, senior officers could receive PLI of up to 365 days of Basic Pay based on individual performance.

According to the employees’ unions, the scheme was discriminatory as it marked a significant departure from the uniform formula of 15 days’ Basic Pay plus Dearness Allowance applicable to the rest of the workforce.

The revised PLI scheme was also a departure from the agreement reached between the unions and the Indian Banks’ Association in 2020, under which the incentive was to be linked to the overall performance of individual banks and applied uniformly to employees and officers.

There has also been substantial progress on the Performance Linked Incentive issue. The Finance Ministry earlier this month said the scheme had been kept in abeyance following detailed discussions, addressing one of the unions’ main demands.

“As regards the PLI Scheme for Scale IV and above officers, the discussions can start with Indian Banks’ Association (IBA) to propose modifications to the Government in the scheme to address the observations of the Unions/ Associations. The residual issues as listed in the minutes dated 8.3.2024 will be discussed between the parties for expeditious resolution,” the UFBU circular said.

MoU for residual issues

Other UFBU demands include the updation and improvement of pension benefits, a uniform dearness allowance formula for all pensioners, and an option for employees covered under the National Pension System (NPS) to switch to the Old Pension Scheme (OPS).

The UFBU’s demands also include issues such as LTC/LFC monetisation, fitment anomalies, grid holidays and regulated working hours for officers, apart from common issues concerning pension, PLI, medical benefits and welfare.

“The proposed MoU now records that these residual issues will be taken up between the parties for expeditious resolution,” the UFBU circular said.

In view of the proposed nationwide bank strike by the United Forum of Bank Unions (UFBU) from September 28 to 30, 2026, the government has announced that all Public Sector Banks and Regional Rural Banks will operate normally on Sunday (September 27, 2026).

The UFBU, which claims to represent 90% of the banking workforce, is set to go on a three-day strike beginning September 28, primarily seeking a 5-day banking week, among other demands.

The strike, if it materialises, would coincide with the half-yearly closing of the banking sector.

“In order to ensure that the genuine banking needs of the public are not adversely affected for an extended period, all Public Sector Banks and Regional Rural Banks will function normally on Sunday, the 27th of September, 2026,” the statement said.

The Reserve Bank of India has granted approval for all bank branches, offices, ATM-link branches and currency chests to remain fully operational on September 27, it said.

The Department of Financial Services under the Ministry of Finance reiterated that the welfare and convenience of bank customers remains the government’s foremost priority.

The government and bank managements have appealed to unions to defer the proposed strike and have also taken measures to ensure that essential banking services continue uninterrupted, it said.

Banks have also advised their customers to complete essential banking transactions well in advance of the proposed strike dates to avoid any inconvenience.

(With PTI inputs)

The United Forum of Bank Unions (UFBU) will hold a nationwide strike on September 11, 2026, over the delay in implementing a five-day banking week, differences over performance-linked incentive (PLI) schemes, and several other pending demands, including pension-related issues.

If the strike materialises, banking services, particularly in public sector banks, could be affected for four days in several parts of the country. September 11 falls on a Friday, followed by bank holidays on Second Saturday and Sunday. September 14 is also a holiday in some States on account of Ganesh Chaturthi.

More bank strikes planned

UFBU, an umbrella body representing nine bank employees’ and officers’ unions, has also announced a three-day nationwide strike from September 28 to September 30, coinciding with the half-yearly closing period. The forum has further warned of a “continuous indefinite strike” from October 26 if its demands remain unaddressed.

The decision was taken at a meeting held on Sunday (August 23, 2026), with the UFBU alleging that the government’s approach towards key demands had been “negative”.

Key demands of bank unions

Presenting a four-point charter of demands, including the implementation of a five-day banking week, which unions said had been promised in 2024, the UFBU said employees had been compelled to launch the agitation because assurances given by the government and bank managements had not been fulfilled.

According to union leaders, an agreement signed in March 2024 provided for Saturdays to be declared holidays, while employees agreed to an increase of 40 minutes in working hours from Monday to Friday.

“This agreement has been recommended to the Finance Ministry, Government of India, for approval. More than two years have passed, but the issue is still pending with the Finance Ministry,” UFBU leaders said.

The unions also called on the Union government to withdraw what they described as a “unilateral and discriminatory” performance-linked incentive scheme prescribed by the Department of Financial Services (DFS). They alleged that the cost of incentives paid to 5% of the workforce was substantially higher than the total incentive paid to the remaining 95%, resulting in significant disparities.

The unions also objected to the government’s PLI scheme for bank officers in Scale IV and above. They argued that the scheme departed from the understanding reached with the Indian Banks’ Association (IBA), under which performance-linked incentives were to be linked to the overall performance of individual banks and applied uniformly to employees and officers up to Scale VII.

Centre puts PLI scheme on hold

Meanwhile, the Ministry of Finance has said that it has decided to keep in abeyance the performance-linked incentive scheme proposed for 2025-26 for public sector bank employees, following a meeting between Finance Minister Nirmala Sitharaman and a delegation of bank employees led by the Bharatiya Mazdoor Sangh (BMS), the labour wing of the RSS.

“The delegation raised various issues relating to the banking sector, including a review of ex gratia payments, medical facilities for retired employees, revisiting the present structure of the PLI scheme applicable to employees of public sector banks, and other concerns relating to employees,” the Ministry of Finance said in a statement.

“The concerns expressed by bank employees were taken cognisance of, and in response to the representation received on the PLI structure, it was decided to keep in abeyance the implementation of the PLI scheme dated November 19, 2024, for FY 2025-26 and take up the matter during the ongoing Bipartite Settlement/Joint Note discussions,” it added.