Many times company needs to reduce its main power. To do so there are various measures, of which VRS is also one of the important ways. Voluntary Retirement Scheme (VRS) 2022 is the initiative that helps of which organizations reduce their manpower. Today in this article we are going to elaborate in detail about VRS. You can accumulate VRS related to all the details engraving objectives benefit features need purpose and more from this article.
Voluntary Retirement Scheme
Employees can use a voluntary retirement scheme to get retirement prior to the period of retirement. The employee’s workers executives of company authorities of cooperative society etc can take voluntary retirement. This scheme is applicable to both public and private sector companies. This scheme is also known as a golden handshake. To take voluntary retirement dad are many rules and regulations which have to be followed. One of the most basic and important rules is that the employee who has taken voluntary retirement cannot apply to another firm that belongs to the same industry.
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Highlights Of Voluntary Retirement Scheme (VRS)
- Name of the scheme: Voluntary Retirement Scheme
- Launched by: Government of India
- Benefits: organizations
- Objective: produced employee strength
Objective Of Voluntary Retirement Scheme (VRS)
The main objective behind starting a voluntary retirement scheme is to reduce the employee strength in case the company is not able to pay employee dues due to financial problems.
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Benefits Of Voluntary Retirement Scheme (VRS)
This scheme is very beneficial for the employees and employers as well.
- Employees are offered many benefits like rehabilitation facilities for staff, advice on managing funds, etc which will automatically improve their income.
- The employees are offered voluntary retirement
- Employees can take retirement before the retirement date with this scheme
- Voluntary retirement is completely the decision of the employee. Employees can take the decision to take retirement before the due date If they desire to.
- a voluntary retirement scheme is for employees who have completed 10 years of service or whose age of the employee is more than 40 years
- This scheme is offer by both public and private organizations
- The person taking voluntary retirement cannot apply for a job in the same industry
- An employee who is taking voluntary retirement will also get all the retirement benefits including provident fund amount, graduation, and more as applicable.
Situations for VRS
- Obsolescence of product or technology
- Takeovers and mergers
- Joint ventures with foreign collaborations
- Recession in business
- Intense competition
Compensation of VRS
- Compensation will calculate on the last salary drawn
- Payment offer by the company should be equal to the 3 months of salary of the employee for each complete year of service all the salary at the time of retirement will multiply by the remaining months left
- In public sector banks, calculation of compensation will be made on the basis of 45 days of salary for every year of service or for the remaining period whichever is low
Conditions for VRS
Employees can take the VRS in the following cases:
- Recession in business
- Intense competition
- Joint venture with foreign collaboration
- Takeover and merger
- Obsolescence of product or technology
Eligibility Criteria
- The age of the application should be at least 40 years
- Applicant must work with the organization for at least about 10 years
Voluntary retirement scheme entitlement
- The applicant will get a provident fund and graduate
- The amount given at the time of voluntary retirement is tax-free
- Employees taking retirement will get compensation
- Beneficial packages offers to the employee by the employer
Voluntary Retirement Scheme (VRS) 2022 Application procedure
To get the benefits of the voluntary scheme employees to have to submit the volunteer application to the concerned authority of the organization. The decision of voluntary retirement request acceptance or rejection is completely dependent on the authorities.