"The idea is to arrive at a package that would earn the worker a monthly interest of Rs 4,000-5,000.''

Vinod Mathew

Mumbai, Jan. 22

INDIAN Petrochemicals Corporation Ltd (IPCL) will soon come out with a fresh voluntary retirement scheme (VRS).

According to sources, the Ambani-controlled company is no longer targeting the white collar as it did in its earlier offer some 18 months ago. Instead, it will look to give the golden handshake to a sizeable portion of the 3,200-odd unskilled staff that it currently has on its rolls.

If the VRS of 2003, which came barely a year after the Reliance Group took over the company, was offered on medical grounds, the forthcoming one will have no such qualifying parameters. The VRS then had resulted in the paring of the 13,000-strong IPCL workforce by about 1,700 at a cost of Rs 140 crore. The present IPCL staff strength is pegged at 11,110. Unlike the last VRS that was primarily targeted at the managerial and supervisory staff, the company is looking to significantly reduce the number of khalasis (head-load workers), gardeners, canteen employees and drivers, with an approximate package of Rs 7 lakh-Rs 8 lakh per worker.

"The idea is to arrive at a package that would earn the worker a monthly interest of Rs 4,000-5,000. This would be clubbed with a medical insurance plan till 60 years for those opting for the VRS. Even if 1,000-1,200 employees were to take up this offer, it would be a bonus. The cost of the scheme, if it covers 1,000-1,200, would be around Rs 100 crore," the source said.

The strategy this time around is to offer the non-technical, unskilled workers of IPCL nearly as much as was offered to the officers in the last VRS. The package worked out last time was 60 days' pay for every completed year or emoluments for the remaining years in service, whichever was lower. This had come to Rs 8 lakh-Rs 9 lakh per employee.

At that time, the main target was the Vadodara unit of IPCL, which had a workforce of around 8,600. The wish came true as 1,200 of the 1,700 IPCL employees who opted for the VRS were from Vadodara. And the payback period for the Rs 140-crore ploughed into the VRS was less than three years.

According to industry watchers, it may not be as easy to sell the VRS, however, attractive, to the blue-collar as to the white-collar segment in any company.

Therefore, IPCL should be satisfied even if only one-third of the target group takes up the offer, they said.

(This article was published in the Business Line print edition dated January 23, 2005)
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