BSNL Approves Firing Of 54,451 Employees To Cut Losses; Retirement Age Reduced To 58 Years
BSNL now has no option, but to fire employees. Will Govt. allow this?
In a big blow to thousands of employees and their families, BSNL Board has approved the firing of 54,000 employees from their company.
This has been done to reduce losses, and to make sure that BSNL doesn’t shut down.
Will Govt. allow this to happen?
BSNL Board: Yes, We Are Ok With Firing Of 54,000 Employees
Reeling under debts of more than Rs 13,000 crore, state-owned telecom provider BSNL is on shaky ground. Last year, BSNL suffered losses of Rs 7993 crore, which is 20% more than 2017 losses.
A special task force was constituted, which recommended several suggestions to the Govt., in order to revive the ailing company.
Out of these 10 suggestions, three have been approved by the BSNL Board, and one of them includes termination of 54,000+ employees from the company payroll.
How Will This Mass Layoff Happen?
BSNL Board has accepted the proposal to reduce retirement age from 60 years to 58 years, and this single step will help BSNL to remove 33,568 employees,
Besides, for all employees aged above 50 years, a special VRS or Voluntary Retirement Scheme will be announced.
Along with reducing retirement age, and VRS scheme, BSNL will be able to reduce their workforce by 54,451 employees, in a gradual manner, which is 31% of their 1.74 lakh workforce.
Interestingly, the average age of employees in BSNL is 55 years, and this is the reason that BSNL Board has gone for reducing retiring age, and to introduce VRS scheme.
Govt. Won’t Take The Risk, Asks To Wait
Meanwhile, DoT or Department of Telecom, which controls and manages BSNL has asked the Board not to terminate employees during this election phase.
If 54,000 employees from a Govt. owned organization are fired, then it will certainly have a negative impact on the present Govt.
Sources at DoT said, “Announcing the VRS package or job cuts and shutting down businesses of the telecom firm would have huge implications on employees and ongoing elections. DoT decided to wait and watch,”
It seems that the Govt. will delay the terminations until next Govt. takes the charge, and then, the new Govt. will have to make the final decision.
BSNL’s Demise Can Be Stopped?
Such is the condition at BSNL, that employees’ salary was stopped for the first time in 18 years. Some daily wage employees hadn’t received salaries for upto 6 months.
In the month of Feb, we reported that BSNL may terminate more than 35000 employees, and in order to cut costs, almost all employee benefits have been stopped which will save Rs 5000 crore.
But now, as the news of terminating 30% of their employees is final, BSNL is expected to save Rs 13,800 crore over the next 5 years on salaries and wages. At the same time, VRS for employees will cost BSNL Rs 13,000.
We will keep you updated, as more details come in.