Kochi: The board of five associate banks of State Bank of India including that of State bank of Travancore (SBT) has decided to implement voluntary retirement scheme (VRS) for its employees.
Though SBT board had earlier announced that it will not retrench staff as part of the merger with SBI, it is now aiming to cut back on staff strength.
There will be a reduction of 25 percent of staff strength in the branches of SBT. In Kerala, there are 852 SBT branches and 204 branches are facing the threat of closure as per the report finalized by the board. This will mean that one fourth of SBT branches in Kerala face closure. In Tamil Nadu, out of the 176 branches, 58 branches will be closed. International consultancy firm Mackinsy has prepared the project report and the closure of branches and VRS are based on this report.
The SBT board, which met on December 9, has decided to implement VRS for both officers and other staff members. The board of State Bank of Mysore, State Bank of Bikaner and Jaipur, State Bank of Hyderabad and State Bank of Patiala which met in the subsequent days also decided to implement the VRS. The VRS package is same for all the banks.
As per the package, those who had completed 20 years of service or those who have completed 55 years of age can apply for VRS. The employees will receive half of the salary for the remaining months of their service period. Each employee will receive an amount which is half of the total sum of their basic pay and DA. However, the employee will get an amount which is equal 30 month’s salary irrespective of their remaining service period.
A person completing 55 years of age will receive 30 month’s salary for the remaining period of 60 months. However, persons completing 20 years of service will only receive salary of 30 months despite having more months as remaining service period. Those completing 58 years of age will receive 12 month’s salary for their remaining 24 months.
There are 14,000 employees in SBT where retirement age is 60. However, there is no clarity of number of persons to be retrenched and a final decision will be taken after receiving options from the employees. In 2001, public sector banks had announced VRS package to its staff on pretext of implementing new technology.
