Honda Motorcycle & Scooter India rolls out VRS to employees, effective from January 5
On January 5, Honda Motorcycle & Scooter India (HMSI) has introduced a voluntary retirement scheme (VRS) for its employees above the age of 40 or who have completed 10 years in the company. The VRS scheme is effective from January 5 and will remain open till January 23, 2021.
HMSI has said in a statement that it is realigning its production strategy for improved overall operational efficiency with the objective of long term business sustainability in these uncertain times.
Naveen Sharma, Division Head – General Affairs, HMSI, said in a letter to the employees, “In order to maintain existence in this competitive two-wheeler market, it is essential to continue with high efficiency and competitiveness. Therefore, keeping in view all the above reasons, the management has introduced a ‘VRS’ for all the associates who want to retire voluntarily from the company before their fixed retirement age, so that they can be relieved from the company gracefully,”
The Directors of the company are not eligible under this scheme, he added.
As VRS benefits, the company offers, three months gross salary into the completed year of service, one month’s basic plus Variable Dearness Allowance (VDA) into the remaining year of service, and ex-gratia of Rs. 22,000 into the completed year of service.
The first 400 applicants will get an ‘early bird incentive’ of Rs. 5 lakh each and if the VRS application exceeds 400, additional Rs. 4 lakh will be paid to all the applicants, Sharma wrote in the letter.
The Company has also announced the maximum amount for applicants for permanent workmen and Junior Engineer (JE) and above. For instance, for Senior Manager or Vice-President, it has capped at Rs. 72 lakh, for Manager Rs. 67 lakh, for Deputy Manager at Rs. 48 lakh and Rs. 15 lakh for Assistant Executive.
Last year, Honda Cars India initiated VRS schemes for workers at its Greater Noida facility and office associates to improve productivity and efficiency amid a prolonged slowdown in the local market. The company recently stopped production operations at the Greater Noida unit.