# Government pauses bonus scheme for PSU bank staff just before nationwide strike

> The finance ministry has paused the rollout of a performance linked bonus scheme for public sector bank employees in FY2025-26, days before a nationwide bank strike planned for September 11.

**Type:** article · **Category:** Business · **Published:** 2026-09-08 · **Source:** TrendKia
**Canonical:** https://trendkia.com/en/business/sarakari-bainkon-men-pli-bonasa-skima-para-roka-haratala-se-thika-pahale-bara-phaisala-29498 · **Language:** English
**Tags:** PLI scheme, public sector banks, bank strike, bank employees, BMS, Nirmala Sitharaman, UFBU, IBA

The finance ministry has decided to hold off on introducing a Performance Linked Incentive, or PLI, scheme for staff at government owned banks in the financial year 2025-26, a move that comes just days before unions were set to walk out on a nationwide strike.

## Why the rollout was paused
Employee representatives had been arguing for weeks that the yardstick used to judge individual and bank wide performance needed a fresh look before any bonus scheme tied to it could be rolled out fairly. Once that demand reached the finance ministry, officials chose to pause the rollout rather than push it through while the assessment framework itself remained under dispute. The bigger question employees are now asking is whether the scheme, once it does return, will end up helping their take home pay or working against it.

## What was discussed with the finance minister
According to the finance ministry, Finance Minister Nirmala Sitharaman held talks with a delegation of employees from various public sector banks, led by the Bharatiya Mazdoor Sangh (BMS). The delegation raised three separate concerns: the ex-gratia amount paid out to staff, medical facilities available to retired bank employees, and changes needed in the PLI structure currently applicable to PSB staff. The timing of the decision is notable too, arriving just ahead of a countrywide bank strike called over a set of demands that includes the PLI issue itself.

## A scheme announced last November, now under review
The PLI scheme itself is not brand new. The government had announced it on November 19, 2024, after taking employee organisations' concerns into account at the time. What has changed now is the decision to pause its implementation specifically for 2025-26. The finance ministry has reiterated that it remains committed to resolving these issues through dialogue, discussion and mutual understanding, keeping in mind the wider interests of bank employees, customers and the banking sector as a whole. The scheme, officials said, will be reviewed before any decision is taken on reintroducing it.

## Unions plan a nationwide strike on September 11
The United Forum of Bank Unions (UFBU), the joint platform of bank labour organisations, had already decided to go ahead with a nationwide strike on September 11. Among the unions' central demands are the introduction of a five day banking week, changes to the performance linked incentive scheme, and resolution of long pending pension related issues. Bank unions have specifically objected to the government's PLI scheme as it applies to Scale-4 officers and above, arguing that it does not match the terms agreed upon earlier with the Indian Banks' Association (IBA).

## The Scale-4 dispute over bonus amounts
Under the original understanding with the IBA, the performance linked incentive was meant to be tied to a bank's overall performance and was supposed to be uniform for both employees and officers up to Scale-7. The government's scheme departs from that in a significant way. Officers at Scale-4 and above can receive a PLI amount equal to up to 365 days of basic pay, calculated on individual performance. Employees and officers up to Scale-3, on the other hand, are eligible for a maximum PLI equal to just 15 days of basic pay plus dearness allowance. Employee organisations have pointed directly to this gap between the two categories and are demanding a review that makes the rules consistent across ranks.

## What this means for you
If you work at a public sector bank, or you bank with one, the next few days are worth watching.

- **Staff bonus pay:** With the PLI scheme paused, officers at Scale-4 and above will not get the extra performance bonus for now. Employees will have to wait until the assessment framework is reviewed.
- **Banking services on September 11:** If the UFBU strike goes ahead as planned, branch work like cheque clearance, cash deposits and loan processing could slow down. It is worth finishing any urgent banking work a day earlier.
- **Retired employees:** The demands on medical facilities and the ex-gratia amount are still under discussion, so changes there are not expected to take effect immediately.
- **Pension matters:** Pending pension issues are also part of the strike's demands, so retired bank staff should keep an eye on the government's next move on this front.

## Why this happened
This decision did not come out of nowhere, it follows months of demands from employee organisations and pressure from the upcoming strike.

- **Doubts over the assessment method:** Employees did not trust the framework used to judge performance, so they demanded a review before the scheme was rolled out.
- **A departure from the IBA agreement:** Unions say the current structure for Scale-4 and above does not match the original agreement, under which the bonus was to be based on a bank's overall performance and be uniform across ranks.
- **The strike deadline:** With the September 11 strike already fixed, pressure grew on the government to resolve the matter through talks, which led to the scheme being paused for now.
- **What comes next:** The ministry has made clear the scheme has not been scrapped, only that it will be reconsidered after a review.

## Questions & Answers

### 1. What is the PLI scheme?
It is a performance linked incentive bonus given to employees of government owned banks.

### 2. Why has the government paused the scheme?
Bank employees demanded a review of the performance assessment framework first, so implementation for 2025-26 has been put on hold for now.

### 3. When was the scheme announced?
The government announced it on November 19, 2024.

### 4. Who did the finance minister meet?
Nirmala Sitharaman met a delegation of public sector bank employees led by the Bharatiya Mazdoor Sangh (BMS).

### 5. Who has called the strike on September 11?
The United Forum of Bank Unions (UFBU) has called the strike.

### 6. What are the main demands behind the strike?
A five day banking week, changes to the PLI scheme, and resolution of pending pension issues.

### 7. How much PLI can Scale-4 and above officers get?
Up to a maximum equal to 365 days of basic pay, based on individual performance.

### 8. How much will regular employees and officers up to Scale-3 get?
A maximum equal to 15 days of basic pay plus dearness allowance.

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