Companies

BPCL employees filing litigations against sale will be denied shares under ESPS

V.Sajeev Kumar P.Manoj Kochi/Mumbai | Updated on September 29, 2020 Published on September 29, 2020

Govt strategy to smoothen deal, nip potential court cases

Bharat Petroleum Corporation Ltd (BPCL) has rolled out an employee stock purchase scheme (ESPS) on Monday seeking to win over employees to its side on the planned privatisation of the state-run refiner with the caveat that those litigating against the sale will be ineligible for the shares offered at a discount.

All permanent employees, including all those who are on deputation, who have completed five years of service on September 28 are eligible for the ESPS.

“However, any employee individually or as a member of any collectives(s) has filed or files any litigation before any Court of Law in relation to ‘Strategic Disinvestment of Government of India shareholding in BPCL', then he/she shall not be eligible to participate in the Scheme,” a BPCL document, reviewed by BusinessLine, said.

“Even if any employee is a party to any such litigation/representation/complaint on date of this offer, he/she will still be entitled to apply for the benefits of the scheme. However, allotment/transfer of shares will be made only if employee withdraws from such litigation or withdraws the above representation/complaint and submits proof thereof before October 15, 2020 or any extended date which the management may determine, at its sole discretion,” the document explaining the ESPS details, said.

While approving the ESPS, the government directed BPCL to include the condition making litigant employees ineligible for the scheme, multiple sources briefed on the plan, said.

“The ESPS is being given as a reward for co-operating with the government on privatisation of BPCL. As such, how can employees opposing the sale be entitled to the shares on offer,” a source said.

Trade unions file writ

Four trade unions at the Mumbai refinery of BPCL have jointly filed a writ petition in the Mumbai High Court against privatisation. The writ is yet to be admitted. More such petitions are being planned by some of the 16 trade unions of BPCL across locations.

“To say that employees filing cases against privatisation will be denied ESPS is outright discrimination. A citizen or a trade union is being denied his democratic right and freedom by the government to go to court. This is an unlawful and anti-democratic move,” said Aji M G, general secretary, Cochin Refineries Workers Association.

Eligible employees have to exercise their option for acceptance of the offer while they are in service of BPCL. Acceptance of offer has to be exercised during the initial offer period between from September 28 and October 31 or the extended offer period between November 16 and January 16, 2021.

In the case of death in service of an eligible employee, his/ her nominees will be given the option to exercise the option for purchase of shares. The payment for purchase of shares has to be made between April 1 and April 15, 2021.

The shares transferred to the employees under the scheme will have a one-year lock-in period from the date of transfer.

The shares offered under the scheme will lapse and are deemed to be cancelled if the employment/ service with BPCL ceases on account of suspension/ termination/resignation before the transfer of shares and the employee is a litigant against the disinvestment of BPCL.

BPCL has initiated talks with banks for a competitive offering of 'unsecured personal loans' to desirous employees to help them raise short/medium term loans to fund the purchase of shares and pay perquisite tax as per the Income Tax Act.

BPCL Trust for Investment in Shares currently holds 9.33 per cent stake of BPCL’s paid-up share capital. Of this, 2 per cent is being offered to specified employees through the ESPS.

 

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Published on September 29, 2020
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