The Hindu Business Line : HPCL may announce VRS in June/July

"We did not want to rush in. One reason was that there was ambiguity about the proposed privatisation of HPCL. The process has been in limbo in the Supreme Court since September 2003. Another reason was impending elections. We do not know the privatisation policy that the new Government will adopt," the official told Business Line.

The Union Government had announced plans to offload about 34 per cent of its 51 per cent stake in HPCL.

Another 5 per cent stake would be offered to employees at concessional rates, bringing down the Government's stake to 12 per cent.

According to the official, many HPCL employees would accept the VRS if the company is privatised.

However, should the new Government decide against privatising, the company might change its strategy on offering the VRS.

"The only reasons for offering a VRS would be if we bring in technology. For example, our ERP package goes live next year.

"Also, HPCL is automating its operations across the country. If the company is privatised, many people will be willing to accept a severance package. If not, we will have to think up options to relocate the workforce. This will be clear by June or July," he said.

Hindustan Petroleum had proposed to shed about 11 per cent of its workforce by offering the surplus staff a VRS.

The company had identified about 1,000 surplus employees in non-management category and 250 in management category (forming about 11 per cent of workforce).

HPCL's PSU competitor BPCL announced its VRS earlier this month.

Both companies are on the Union Government's privatisation list.