The State Bank of India’s recent decision to recover the compensation paid to the employees of its erstwhile five associate banks (e-ABs) for the extra work they were forced to undertake in the immediate aftermath of demonetisation has understandably stirred a hornet’s nest.It is learnt that SBI has instructed the respective circles of the bank to initiate the process of recovery. After the sudden announcement of demonetisation of high value currencies on November 8, 2016, bank offices were closed for two days so as to facilitate checking, counting and remitting the banned notes to Reserve Bank of India (RBI). Thereafter, in terms of the government’s decision, the banks were required to exchange the dud notes surrendered by the public for valid currencies till December. All of this placed extraordinary pressure on bankers and banking officials to meet deadlines and satisfy the restive customers who had queued up outside banks across the country. They were compelled to work even during unearthly hours. Many banks, including SBI, compensated the employees in the form of varying amount of cash payments. The associate banks – State Bank of Hyderabad, Mysore, Patiala, Travancore and Bikaner and Jaipur – were no exception.History of compensationThe practice of paying overtime wages for work beyond normal working hours is in vogue in most banks. For employees comprising the clerical and the assisting staff, who are collectively called the ‘award staff’, bipartite settlements at the industry make it mandatory to pay such compensation at the prescribed rates. For officers who conventionally supervise the work of the award staff, there has historically been no such concept like overtime wages. This, over the years, caused problems as clerks (who worked late hours or on holidays) had to get their compensation approved by officers who themselves would not get any compensation. Over years, through understandings between officers’ associations and the bank managements, the system of compensation for officers was also introduced. The amount of compensation depended on the bargaining capacity of the associations and the attitude of the management. When the officers’ service regulations (OSR) were standardised in 1973, as recommended by the Pillai Committee, the regulations introduced compensation for extra work like annual and half yearly closing of bank accounts and split duty allowance when officers were required to work in offices operating with split working hours. An extension of this principle was introducing compensation for working on holidays. Such a system has been in operation for many years now.Interestingly, OSR 48 says: ‘Every officer shall be available for bank’s duties at any time of the day’. Interpreted literally, an officer should be available only during day time. In reality, even in today’s computerised environment, one will find bank officers working late hours as was the case before nationalisation in 1969. It is, therefore, reasonable for humane managements to incentivise the officers compelled to work on holidays. Demonetisation stressThe post-demonetisation work pressure on the bank staff was beyond the ordinary. Sanctioned leaves were cancelled or cut short. Usual family reunions scheduled in December were put off and, in some cases, the marriages of young staffers had to be rescheduled during the two months following demonetisation.The SBI’s decision to recover the compensation paid by its associate banks (e-ABs) to their employees during the aftermath of demonetisation raises very pertinent questions. The compensation was already paid to their staff by the e-ABs as did SBI and many other banks. It was a conscious decision at that point of time. Can the SBI annul such decision? Even in cases where the compensation was agreed to be paid but not actually disbursed can the SBI abrogate such agreement? Under S.2 (2) of the State Banks (Repeal and Amendment) Act 2017 which formalised the merger of e-ABs with SBI by repealing the State Bank Subsidiaries Acts anything done or any action taken including any agreement by the subsidiaries shall continue to be in force.Considering the apprehensions in the minds of the employees of e-ABs of a possible step-motherly treatment by the big brother after the merger, the SBI’s decision begs another question: When the principle of equal pay for equal work is still the core of the compensation system in the industry, can SBI treat its one set of employees who came from e-ABs as second-class citizens? Human resources are key drivers of a service institution’s business. How they are treated is an indicator of the approach of the institution. One gets an impression that on a sensitive issue like compensation already paid, SBI is tending to be pennywise and pound foolish.T.R. Bhat was joint general secretary of All India Bank Officers’ Confederation from 1995 to 2009. His book, ‘Reforming the Indian Public Sector Banks-the Lessons and the Challenges’, was released in April 2018.