Ex-Gratia+Pension Payout for BSNL, MTNL Staff Who Took VRS to be Capped

New Delhi: The Centre has limited the ex-gratia pension plus pay-out for around 93,000 employees of BSNL and Mahanagar Telecom Nigam Limited (MTNL) who were forced to opt for VRS (Voluntary Retirement Scheme) as of January 31 this year to 35 days for each completed year of service and 25 days for each year of balance service left until the actual date of retirement.

According to a report by The Indian Express, the government used what it calls the “Gujarat Model” of VRS for the pay-out for these employees. The model, first conceptualised to offer VRS to state-owned sick or incipient sick public sector undertakings (PSUs) of Gujarat, limits the immediate dues payable by companies.

“Under the VRS model offered to BSNL and MTNL employees, the ex-gratia payout for retiring employees was limited to 35 days for every completed year of service and 25 days for each year of balance service left until actual date of retirement,” says the report quoting data accessed by the reporter.

Though the VRS was given to employees in the age group of 50-60, as per this method, they were divided into two groups. Employees above 55 years of age would get a lumpsum once they reach age 60, and or those below 55 years of age, the pension would be commuted in 2024-25. Gratuity dues will also be delayed in a similar manner, the paper said.

Further, the ex-gratia-plus-pension pay-out will also be capped at 125% of the present basic and dearness allowance (DA); and the government has decided to give out ex-gratia payment for only 40 months, irrespective of the employees’ remaining service term as of January 31, it added.

Read More: BSNL: ‘Delayed’ Revival, Jittery Employees

Usually, the employees who opted VRS from PSUs would receive lumpsum dues accumulated over the period of service, plus the remaining service period’s salary – all paid out in one go.

For example, if an employee earned Rs 10,000 per month and 40 months of service remained at the time of VRS, the pay-out through the ex-gratia and pension benefit payment for the remainder of service would have come to around Rs 6 lakh. However, the actual pay-out now will be 125% of their respective current salary or Rs 5 lakh. In case an employee has 79 months or more of service left, the lumpsum will still be paid only for 40 months and less than 125% of salary, the report said, explained how it is affecting the rights of employees.

As per the report, the government aims to undertake the new VRS model for BSNL and MTNL for the next 10 financial years and aims to cut staff strength at BSNL to below 50,000 and at 2,600 for MTNL in 2027-28.

This issue was raised in Parliament as well. Then, dismissing the suggestion that the VRS was not attractive and it was a replication of the 'Gujarat Model', Telecom Minister Ravi Shankar Prasad said, "The Gujarat model is good. Everything about Gujarat is not bad".

Although Prasad on Wednesday said the Centre was committed to the revival of BSNL, the public sector telecom service is provider is still awaiting the revival package since the past five months.

During Question Hour in Lok Sabha in the ongoing session, Prasad informed the House that it was not possible to retain all employees, and that nearly one lakh employees of Bharat Sanchar Nigam Limited had opted for VRS.

"The government of India is committed for the revival of the BSNL. Our intention is to keep the BSNL alive and that it performs. But it is not possible to retain all employees," he said.

Asked about possibility of BSNL adopting 4G technology, Prasad said the Union Cabinet had taken a decision in this regard and BSNL would roll out 4G services soon.

Unions and associations in BSNL, however, have been demanding allocation of 4G spectrum for long. But, the government, which has been claiming that they would revive BSNL, has not allocated 4G spectrum yet.

The situation of BSNL contract workers is worse across the country. Almost 80,000 contract workers are yet to receive salaries for the past 12-16 months. In certain circles, such as Western Uttar Pradesh, the situation is worse. Though, at least 10 employees have reportedly committed suicide in the past one year, there was no mention about them in the revival package announced by the Centre.

Read more: 4 Months after BSNL, MTNL Revival Package Announcement, Silence over 4G, Sovereign Guarantee for Bonds

Replying to a question related to contract workers, Prasad informed the House that contract employees connected with BSNL were employees of contractors, not of the BSNL. "We are making payments to contractors so that they can stand on their own feet," he said.

The VRS was offered by BSNL to its employees on October 4, 2019. When the VRS option was floated for BSNL and MTNL employees, half of BSNL employees (78,569 of 153,000) and 80% of MTNL employees (14,400 of 18,000) took the option till the closing date on December 3, 2019, of the scheme.

(With Inputs from PTI)