State Bank of India introduces a new voluntary retirement scheme
State Bank of India (SBI), has announced a voluntary retirement scheme (VRS) that gives an option to employees who do not get promoted beyond a certain level to move out.
The scheme will be opened for three months, from December to January, every year, and employees who have completed 25 years of service and are 55 years of age will be eligible for the same. A total of 11,565 officers and 18,625 staff of SBI are eligible for the new VRS plan.
The employees opting for this voluntary retirement scheme (VRS) will be paid 50 percent of their salary for the residual period of service. If 30 percent of the eligible employees opt for the new scheme, the bank expects net savings of around Rs 2,170.85 crore. SBI had nearly 2.5 lakh employees on its rolls as of March 2020.
The bank, through its scheme called ‘Second Innings Tap-Voluntary Retirement Scheme-2020 (SITVRS-2020) aims to optimize human resources and costs.
The bank said that the scheme is developed and would be discussed with the government, its majority shareholder. But they refused to elaborate on details.
After the Covid-19 outbreak, many employees with co-morbidities and other disorder had indicated they would prefer to stay home and avoid venturing out. Some weren’t inclined to move from one city to another. Such employees have expressed the desire for such a scheme, the bank official said.
Another driver behind such an offer was the plan to reduce the average age of the organization. That would help in renewal when people move up the ladder faster and fresh talent is absorbed, the official said.