In Brief
The State Bank of India (SBI) posted a senior officer abroad on a fixed monthly salary with an explicit clause allowing revision of salary and terms "from time to time." When updated cost-of-living data became available in 2000, a Government-constituted Standing Committee revised salary for all public sector bank officers posted abroad using a uniform Cost of Living Index formula, reducing the officer's salary. The officer challenged this in the High Court, arguing unfairness and lack of consultation. The Supreme Court upheld the salary reduction, holding that: (1) the original offer letter clearly permitted salary changes; (2) the reduction was applied uniformly to all officers of the same grade across all banks; and (3) it was based on objective Cost of Living data pursuant to Government directions. The employee had no contractual right to prevent such a change or demand prior consultation with the Standing Committee.
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