Taxes, transfers and all other worries that dog BSNL and MTNL employees as they decide on VRS
- Debt-laden telecom players BSNL and MTNL rolled out their retention package for employees, expecting over 80,000 employees to opt for it.
- Over 22,800 already applied for
VRS, as of November 7.
- The telco has not yet credited the salaries of October and the management is planning mass transfers after implementing VRS.
- As per the government retention plan, employees above 55 years of age will receive their pension until they turn 60.
That does not mean its employees are happy. The mood at the debt-laden telecom player is sombre.
“We are still discussing the pros and cons of the VRS package. Most of us are confused because of the dubious future of the telecom operator. Our salaries were already delayed hence most of employees taking the VRS package don’t want to be stuck again,” a BSNL employee told Business Insider India.
The two state-owned telecom players BSNL and MTNL rolled out their retention packages this week — expecting over 80,000 employees to opt for it. The government, which is bailing out these debt laden companies expects to save as much as ₹7,500 crore via VRS.
This VRS package is only one part of the massive restructuring at that these companies —- which will be merged — will undergo. Rumours are doing the rounds that those who do not opt for the VRS package could be transferred, creating panic. Those who are opting for it are also stressing over the 30% tax that they will have to pay on the lump sum amount they will receive.
The telcos employ nearly 200,000 people, out of which 121,000 are eligible to take VRS.
Transfers complementing VRS
The government is also planning to trim the retirement age of employees to 58 years. This is another pain point for employees who are already worried over delayed salaries, and changing terms of their employment. The telco has not yet credited the salaries of October and the management could be planning mass transfers after implementing VRS.
“Concerns over mass transfers are looming large at all the BSNL and MTNL offices. The employees who aren’t taking the VRS option might have to transfer to a location decided by the management. This can also be one of the many reasons why people are taking the VRS option. Most of the people are settled with their families and don’t want to move just anywhere,” he added.
Gone with the tax
Those opting for VRS will receive almost half their salaries, in three installments.
“As lucrative as it may seem, the employees availing the package will have to shed 30% of their advanced salary as tax. They are anyway going to get only half the salary as pension and the high rated tax doesn’t help in the long run,” a BSNL employee told Business Insider India.
The VRS scheme will be available till 5:30 pm on December 3, 2019. The government infused ₹29,900 crore for VRS settlements and retirement liabilities of BSNL and MTNL.
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