Under the prescribed instructions from IMF and the World Bank, the Government of Pakistan planned to downsize the staff in all nationalized commercial banks.
After negotiation amongst the nationalized commercial banks and Ministry of Finance and the Privatization Commission, a scheme namely Golden Hand-shake Scheme was launched in order to complete the process of downsizing the staff.
All banks’ accepted and adopted the Scheme. The management of UBL, however, declined and launched the UBL Retrenchment Scheme 1997 for their staff. Nawaz Sharif knew about it.
Dr Mehboobul Haq, former Finance Minister had protested and stated in the TIME Magazine that this was not only economic murder of 5,416 employees but also of the nation.
Dr. Mohateer Mohammad, the former PM of Malaysia declared in one of the leading Malaysian News Paper Daily Express that this was not good for the nation of Pakistan. He opined that it would lead to unemployment and poverty will increase.
On October 14, 1997 Nawaz Sharif as PM ordered reinstatement of the retrenched employees with immediate effect during opening ceremony of Motorway but the UBL management refused to comply. Resultantly, the matter remains pending for the past 16 years.
Some facts of the Golden Hand-shake Scheme and the UBL Rretrenchment Scheme1997 are given below:
1- GOLDEN HAND SHAKE SCHEME
This scheme launched by the Government of Pakistan in all nationalized commercial banks in order to complete the process of downsizing staff as per prescribed instructions and tariff of the IMF as soon as possible.
The Government declared that it never dismissed or retrenched any employee in any commercial nationalized banks on the basis of downsizing the staff under this Scheme.
2- UBL RETRENCHED EMPLOYEES-1997
This Scheme was launched only by UBL against the Golden Hand-shake Scheme which was a clear violation by victimization with force. Under it, the employees were paid only 50% share instead of 100% shares which they were entitled to under the other Scheme.
The IMF provided full funds to UBL under the instructions of Ministry of Finance and the Privatization Commission in order to complete the process of downsizing the job properly but bank distributed 50% shares to the retrenched employees, without pension benefits. The rest of the amount was kept by the management of the Bank illegally which is still lying in a Sundry Deposit Account.
Some funds have already been utilized by the new management of the Bank after privatization illegally without getting prior permission from the Government of Pakistan.
Due to this illegal retrenchment, the concerned employees and their families have been financially ruined.
The Government of Pakistan still has ownership rights of 51% share of the Bank as per Agreement executed with the Bestway Group (the new management of the Bank).