BSNL on Wednesday notified its Voluntary Retirement Scheme (VRS) 2019 for its employees who are above the age of 50. The scheme will be made available to those eligible up until December 3. BSNL estimates that an estimated 70,000 to 80,000 persons will opt for the scheme that will help save Rs 7,000 crore in the form of wages to be paid.
In a written communication to its circles, BSNL said, "In pursuance to the decision of the Union Cabinet and conveyed by Department of Telecommunications (DoT), the BSNL Voluntary Retirement Scheme - 2019 is being circulated to all concerned and invites options from employees eligible under the scheme for seeking voluntary retirement as per the provision of the scheme."
The chairman and managing director of BSNL PK Purwar told Live Mint that this was the best VRS given by the government and BSNL employees should see it in a positive frame of mind."
The scheme is open for both regular and permanent employees of BSNL. Those with a deputation to other organisations or posted outside BSNL on deputation basis of the age 50 and above are also eligible for the scheme.
The ex-gratia amount for the eligible employee will be equal to their 35-day salary for each completed year of service. Those with service years remaining will receive an ex-gratia salary of 25 days for every year of service left until superannuation.
The VRS for Mahanagar Telephone Nigam Limited (MTNL) has also been rolled out and is open until December 3, 2019. all regular and permanent employees of 50 years and above as on January 31, 2020.
The effective date of voluntary retirement under this scheme will be January 31, 2020.
The BSNL circle heads have also been instructed to promote the scheme and to hold open house sessions, providing maximum information on the scheme with the aim of high enrollment for the VRS.
The move to reduce the bench strength of the ailing telecom firm comes at a time when its 1.75 lakh strong workforce consumes 75 % of its revenue in wages, reported ET. The telecommunications giant has been facing losses straight for ten years and has accumulated losses with Rs 14,300 crores by 2018-19.
The announcement for the VRS comes after a meeting between some employee unions, BSNL, MTNL and the Telecom Minister Ravi Shankar Prasad on November 4. Earlier in October the Centre had approved a Rs 70,000 crore relief package and had approved the merger of BSNL and MTNL.
Under the new VRS, employees above the age of 53.5 years will get 125 per cent of their salary, which they could have earned in the balance period of their service. Employees between 50 and 53.5 years opting for the VRS will get benefit in the range of 80 to 100 per cent of the remuneration to be paid in the balance period of their service.
For employees currently above 55 years of age, on opting for VRS, the pension will be commuted only when they attain 60 years of age (the current retirement age). For the employees, currently of age 55 years and less, on opting for VRS, the pension will be commuted in the sixth year 2024-25.