Human Right Violation In ICICI Bank.
Human Right Violation Research - BRSR Violation - HR Lab
* Birendra K Jha Certified Social Auditor; Practitioner Social Impact Assessment Audit; Practitioner BRSR (SEBI ) Audit- ESG Audit. EMail: birendrajha03@yahoo.com
Private Banks are hell for employment. If one looks ICICI Bank, one shall get clear picture. More than 700 employees have been removed in this Bank within six months, in 2024 using unfair labour practice. HR neither conducted inquiry nor provided scope of natural justice. This was shocking but worst HR Practice. The law with regard to the termination of employees in India is very clear. In the absence of a formal enquiry, termination without any cause is illegal. This is completely violation of principles of natural justice. If HR dilutes this provision. Then it should be understood that HR Quality is extremely poor.
This is revealed in a document from the Central Labour Commissioner that some more than 700 employees services are closed in 2024 on disciplinary ground without conducting formal enquiry. Such unfair labour practice is used where inadequate or poor internal control processes prevail. This ugly practice is used mostly in the private banks / IT industries to reduce the business cost of operation. To control such poor culture the RBI, the top regulatory authority in Banking has provided 2005 Guideline. This Guideline is only show-piece. RBI is never monitoring the implementation of Guideline at the ground level. This is the reason that ICICI type poor culture company creates worst HR Practice. The RBI has further amended the 2005 Guideline, with the latest "Guidance Note on Operational Risk Management and Operational Resilience" in April 30, 2024.
The RBI Guideline should be read with the "People Risk" and the Risk attached with the Unfair Labour Practices. This Unfair Labour Practices are the major issues in the Universal Declaration of Human Rights mentioned in Article 21-23. In ILO convention also the Unfair Labour Practices are Human Rights violation. This is seen clearly in ILO Convention No. 29,105 and 111.
The RBI in the stated Guideline at Clause 2.1 has defined “Business unit” and risk attached with it. In this definition, "Human Resource" is a Business unit, which Risks are needed to be placed under Assessment Audit. It says:
"the risks inherent in the products, services, activities, processes and systems for which it is accountable and includes all associated support, corporate and/or shared service functions, e.g., Finance, Human Resources, and Operations and Technology".
In Clause 2.8 Operational Risk has been defined with 'People" and "Legal Risk". Clearly "Human Resource" and "Legal Risk" are "Operational Risk", where Assessment Audit is necessary. The RBI defines and says in Clause 2.8 :
“Operational Risk” means the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events. It includes legal risk but excludes strategic and reputational risk.
Further, RBI clearly warns in Clause 6, the responsibility of the Senior Board Members on monitoring risk related with Human Resource practice or violation of Labour Law. This is Board responsibility to identify and conduct Risk Assessment. In Clause 6.2.6 Guideline puts responsibility to conduct "Scenario analysis" with "impact on Business". This is Bank's duty to engage with the following three Risks :
"Compliance, human resources and IT risk management".
Further in Clause 16.2, Bank has been directed:
"REs should disclose relevant Operational Risk exposure information to their stakeholders (including significant operational loss events)".
Employees and Consumers of the ICICI Bank are important stakeholders. The Bank has not published the Risk, Risk Assessment and Countermeasure for Risk in its web site or disclosed in detail in the Annual Report. This is clear RBI Guideline violation.
This is Bank's Board of Directors ultimate responsibility that various risks of the bank’s activities are identified and there should be appropriate methods for monitoring compliance with laws & regulations.
Clearly this call is needed to be taken by the RBI (Reserve Bank of India) and the SEBI. Being matter of Labour Law and Human Right violation, the RBI should mandatorily conduct Third Party Independent Assessment Audit on Labour Law and Human Right Programmes not only in ICICI Bank but in almost all banks under the RBI control.
There is mass scale of RBI Guideline violation in the ICICI Bank. The responsibility should must be fixed on the Board of Directors. Otherwise this shall paralyze the banking operation and create anarchy in society and the country in whole.
Some common poor HR Practices, seen in the ICICI Bank, are shocking. Some examples are : employees are removed without conducting fair trail, or not giving any show cause notice. Employees terminated without termination order or paying any retrenchment compensation. Some times Bank uses manipulated design and deems that the employees have deserted the job. The HR Practice is worst. Either Bank is intentionally doing this or there is huge skill gap in the HR. This practice shall create panic among the employees. It shall harm directly the banking operation.
ICICI Bank is a SEBI registered entity. By virtue of the SEBI legislation, now ICICI Bank has to file compulsorily BRSR ( SEBI ) report after conducting the Third Party Mandatory Audit of Human Right protection in HR Practice. This is Independent Audit, where Auditor conducts assessment of Human Right protection in HR Practice. Several HR related violation shall crop up here if Assessment Audit is done thoroughly in this Bank on Human Right Programmes.
Recently All India Bank Unity Forum has placed a typical complain before the Central Chief Labour Commissioner, Mumbai against the ICICI Bank. Complain is tendered against the Bank, that the Management is wrongfully terminating the employees. Some seven Major Unfair Labour Practice complains are under the consideration of the Central Chief Labour Commissioner, Mumbai. This is very poor state of affairs. The CLC is on record where the Commissioner is citing that the ICICI Bank is indulged in unfair labour practice. The Regional Labour Commissioner - Central has stated:
"The field offices of the CLC (C) Organization have received many complaints/ industrial disputes of illegal termination of services of the workmen/ officers situated across the country. The workmen/employees have even approached the National Human Rights Commission, Delhi against the illegal act of the bank. The commission has also ordered investigation on the complaint and sought report from this office. In all the cases it is found that the management is harassing and illegaly terminating the services of the workmen / employees. Hence the action of the management is illegal, inhuman and also unfair labour practice".
One case is given here which shall demonstrate adequately the poor quality of HR Practice in this Bank. This case is from Delhi -NCR. This is still in HR Practice.
Wrongful Termination:
An employee from Delhi NCR Region, unfortunately landed with accident. He took approved medical leave of a specfic time period. After the passage of time, the employee on connected medical reason failed to report on duty. The ICICI Bank, without conducting any fair trial terminated his job. The Bank deemed that the employee has absconded the job. Bank took the plea that there is a clause in the appointment letter where clearly this is mentioned that the Bank has right to terminate the employment if there is any breach of any rules and regulations by the employee. The HR Department failed to apply mind that appointment letter clause is a subordinate legislation. Without conducting fair trail employee can't be terminated. Bank further took the plea that the employee had voluntarily abandoned the services of the Bank by remaining continuously absent for more than 25 days without any intimation. The "deemed condition of remaining absent for more than 25 days" had been presumed by Bank as "voluntarily abandonment of service". Again in this matter HR Department failed to apply mind, that in this case also without fair trail, termination is illegal. The Bank was aware that the employee is absent under medical condition, where the employee had suffered with serious accident. Rather than examining the true and fair view, the employee was terminated. This was the worst example of HR Practice, where Human Right collapses.
Conclusion:
Hon'ble Delhi High Court in ICICI Bank Ltd. vs Union Of India And Another. on 30 May, 2024.
The Hon'ble Delhi High Court struck down the termination order of the above stated employee. The Hon'ble Court redirected the ICICI Bank to take back the employee. The decided law is following:
The law with regard to the termination is clear and it states that in the absence of a formal enquiry, termination without any cause is illegal since the same is in violation of principles of natural justice.
Takeaway Points:
ICICI Bank HR Practice is poor. HR Department do not know the basic employment law. This creates Human Right violation. The HR is needed to be given training on the Best HR Practices.
No Proper Training On Human Right:
Human Right Training in ICICI Bank is absent. This training now is needed to be reported in the BRSR Report. Since due to poor skill gap on Human Right Training, ICICI bank employees are moving their grievance complain in wrong jurisdiction. This is cease of Human Right protection on fair opportunity of fair trial. The employees are required to be educated and trained under Human Right protection that if there is any cease of Human Right violation, then where the employees should go.
What is seen the ICICI Bank employees on wrongful termination or unfair treatment have moved cases before the State Government. This is wrong jurisdiction. As under Section 4 of the Industrial Disputes (Banking and Insurance Companies) Act, 1949, the Central Government is the only appropriate Government. Under Section 4, the State Governments have been prohibited to refer an employment related dispute for adjudication, inquiry or settlement in Banking and Insurance companies. The Section 4 reads thus:--
Prohibition of references by State Governments of certain industrial disputes for adjudication, inquiry or settlement--Notwithstanding anything contained in any other law, it shall not be competent for a State Government or any officer or authority subordinate to such Government to refer an industrial dispute concerning any banking or insurance company, or any matter relating to such dispute, to any Tribunal or other authority for adjudication, inquiry or settlement.
What is Needed:
1. The RBI should conduct mandatorily Third Party Assessment Audit on Labour Law & Human Right violation in ICICI Bank and other banks under its control. The RBI is needed to take correction measures at the ICICI Bank and impose heavy penalty on the ICICI Bank for violating the RBI Guideline as stated above.
2. The SEBI should examine whether Principle 5 of BRSR Report is filed after Third Party Independent Assessment Audit of Human Right Programmes or not ? If No. Severe action should be taken. If Yes. Review is needed why such types of violation are hidden and not reported.
3. Proper education and training to the Bank employees are needed on Human Right protection. This is entirely missing in the ICICI Bank. Employees needed to be trained on the Competent Jurisdiction, where the employees can approach if there is any violation of Human Right.
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