The United Forum of Bank Unions (UFBU) has strongly opposed the Government’s new Performance Linked Incentive (PLI) scheme for senior officers and announced a nationwide protest programme. In a circular dated March 20, 2026, UFBU called the move an attempt to divide the banking workforce and urged employees to be ready for flash strikes.
UFBU said that the Government is planning to introduce a new PLI formula for Scale IV officers and above, in addition to top executives like Chairmen, Managing Directors (MDs), and Executive Directors (EDs) of public sector banks. The unions stated that this revised scheme is not acceptable as it goes against the existing PLI system.
According to UFBU, the current PLI scheme was developed through bilateral discussions between banks and unions and is part of service conditions under the Bipartite Settlement and Joint Note signed with the Indian Banks’ Association (IBA). The existing system is based on collective performance, applies uniformly to all employees from part-time sweepers to officers up to Scale VII, and is limited to a maximum of 15 days’ Basic Pay and Dearness Allowance (DA). UFBU also pointed out that it has always opposed incentives based on individual performance to protect the interests of employees and officers.
However, the new DFS scheme has several adverse features. UFBU said it is a unilateral decision taken without any consultation with unions or associations. The scheme is based on individual performance of executives, using a performance matrix decided by the Government. It also removes Scale IV to VII officers from the existing UFBU/IBA scheme and places them under the new DFS formula. Under this system, officers will be divided into five categories, and PLI will be given at 0%, 20%, 40%, 60%, 80%, and 100% levels, meaning not all officers will receive incentives even if they perform well. UFBU warned that this will create an artificial divide among officers. Additionally, while the current scheme allows a maximum incentive of 15 days, the new scheme provides incentives of up to 365 days, leading to a huge disparity in payouts.
UFBU said the issue has been under discussion for some time. In June 2025, the Deputy Chief Labour Commissioner (Dy. CLC) had advised banks not to implement the DFS scheme until discussions and conciliation proceedings were completed. UFBU and IBA also held discussions and suggested modifications to reach an amicable solution. After the strike on January 27, 2026, DFS advised public sector banks in February 2026 to implement PLI up to Scale III officers. During the conciliation meeting held on March 9, 2026, the Dy. CLC again advised DFS, IBA, and banks not to proceed further with implementation until the issue was resolved.
Despite these developments, UFBU said that the Government has now directed public sector banks to pay PLI to Chairmen, MDs, and EDs, and also to implement the new scheme for Scale IV officers and above. The unions stated that this shows the Government is not respecting the conciliation process and is moving towards a direct confrontation with UFBU, even though the unions have been trying to find a solution.
Considering the serious implications of the decision, UFBU held a meeting and decided to launch an immediate agitational programme. The unions have also warned that they may give a strike call within 24 hours if there is any further move by banks, IBA, or the Government to implement the PLI scheme for Scale IV officers and above.
As part of the protest programme, UFBU has announced the following actions:
- Wearing black badges from March 21, 2026 by all employees and officers
- Working strictly as per rules and procedures, with no extra cooperation
- Following regular working hours only
- Exiting all official WhatsApp groups
- Not attending any official functions of banks
- Officers will not attend phone calls from management after 6:00 PM
- Preparing for a strike within 24 hours if the situation escalates
UFBU has appealed to all employees and officers to understand the seriousness of the issue, remain united, and make the protest programme successful at all levels. The unions have also asked members to stay prepared for a strike call at very short notice, highlighting that the issue has major consequences for the entire banking workforce.
