The Hindu Business Line : FACT removes ceiling on VRS compensation

FERTILISERS and Chemicals Travancore Ltd (FACT), in a bid to lure more of its workers for voluntary retirement, has removed the ceiling of Rs 5 lakh towards compensation and allowed the employees to choose one of two proposals originally offered by the Government.

Speaking to Business Line on Monday, Mr P.R. Balasubramanian, Chairman and Managing Director of the company, said the decision was aimed at attracting more workers to the scheme. Already, 700 employees had opted for VRS and another 700 are expected to join, he said.

The management had fixed a ceiling of Rs 5 lakh towards compensation to be paid to those who volunteer for retirement, but it was not acceptable to a large section of the workers.

Under the original VRS packages offered by the government on December 24, the employees were required to choose one of two depending upon the benefits and offer their consent by January 10, 2004.

The schemes are Gujarat Pattern of VRS and the Department Heavy Industry pattern. In the first pattern, 35 days salary (basic + DA) for every completed year of service and 25 days' salary per year for balance of service left till superannuation at 58 years of age would be paid. Under the second package, employees would be entitled to 45 days' emoluments for each year of service completed or the monthly emoluments at the time of VRS multiplied by the balance number of months of service remaining, whichever is less.

But the management had fixed a ceiling that in any case it would be limited to Rs 5 lakh or the amount calculated, whichever is less. In addition, they would be entitled to PF and Gratuity but no leave encashment would be available.

Now the workers could opt for one of the options; the last date for opting is February 14.

Meanwhile, the company incurred a net loss of Rs 170 crore during the first nine months of the current fiscal. The negative performance in recent years has eroded FACT's net worth, making it a sick unit. An EGM has been convened for February 28, as under the Sick Industries Act, SEBI, etc., needs to be informed of this fact, the CMD said.

More Stories on : Manpower | Fertilisers

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page