Hyderabad HC stays SBI's plan to assimilate associate banks' officers

The process of absorbing 30,000 officers of the five associate banks initiated by the State Bank of India (SBI) hit a roadblock on Thursday with Hyderabad High Court issuing the interim orders, directing the country's biggest lender to not act on the options given by these staff till June 15.

The court has directed SBI to file responses to the issues raised by the petitioners, P T M Gopalakrishna and either other officers of the State Bank of Hyderabad and Associate Banks Association (ABOA) before taking up the case for further hearing.

The orders come on the day of expiry of the deadline put for the submission of options (of joining the service) for the officers of SBH, State Bank of Bikaner & Jaipur, State Bank of Mysore, State Bank of Patiala and State Bank of Travancore besides the Bharatiya Mahila Bank.   

"We may receive the copy of the court orders in two days. However, High Court judge Justice P Naveen Rao has issued oral orders to SBI not to act on the options till June 15," Harshavardhan Madabhushi,



secretary general of ABOA told Business Standard.

The association has challenged options process citing lack of clarity on service conditions such as seniority in service post merger and certain disparities in superannuation benefits that exist between the existing SBI officers and that of the associate banks in a merged entity.

"We have brought our HR related concerns to the notice of the Union Finance Minister, Reserve Bank of India as well as the SBI chairman in the past one year but we did not receive any positive response. That is why we had to pursue the legal means to seek justice," Madabhushi said.

As the SBI management maintains that the absorption of staff was just a continuation of their service, there was no rationale in offering PF benefit(associate bank staff do not have PF provision)only from April 1, 2017 or tweaking the terminal benefits compared to that of the SBI officers, ABOA argues. They also expressed apprehension over the SBI not spelling out the parameters of their seniority in the merged entity up-front.