MTNL has revealed that more than 13,500 of its employees have opted for voluntary retirement so far. The voluntary retirement scheme is part of the Rs 69,000-crore revival package approved by the government last month to rejuvenate troubled state-run telecom operators MTNL and BSNL.
Mahanagar Telephone Nigam Limited (MTNL) had initially expected 13,500 employees to opt for voluntary retirement scheme (VRS), but the numbers have reached 13,532 two weeks before the offer closes. The PSU had opened its VRS offer on November 5. Based on the Gujarat Model of VRS, the scheme will remain open for the employees till December 3.
"We have received a strong response; and so far, as many as many as 13,532 employees have opted for the VRS scheme. Our internal target had been 13,500. We expect the numbers to reach the range of 14,500 to 15,000 by the closing date," MTNL Chairman and Managing Director Sunil Kumar told PTI.
All regular and permanent MTNL employees aged 50 years or more as on January 31, 2020, are eligible to opt for the scheme. This makes 16,300 out of the 22,000 employees of the company eligible for the scheme.
The move is aimed at reducing the employee cost of MTNL to 25 per cent of revenue from the current 85 per cent by February. MTNL expects to become EBITDA positive within 2 years.
The company has segregated the scheme for three sets of employees-- combined service optees, pro-rata optees and MTNL recruited employees. MTNL VRS note highlighted that up to 46 months of salary is expected to be given as lump sum ex-gratia compensation.
Combined service optees at MTNL will get ex-gratia plus admissible pension of up to 125 per cent of their salary. Pro-rata optees will also get the same benefit as combined service optees having same period of service completed and remaining. While MTNL recruited employees will get ex-gratia up to 100 per cent of salary.
The update on MTNL's VRS offer comes a day after Bharat Sanchar Nigam Limited (BSNL) revealed that 77,000 of its 1.5 lakh workforce have opted for the VRS scheme. BSNL is looking to save up to Rs 7,000 crore in wage bill with its VRS offer. Like MTNL, BSNL's VRS offer is also open till December 3.