Voluntary Retirement Scheme for Central Government Employees
Right now, any employee of central government, post completion of 30 years of service, can retire any time he/she wishes to. The notice has to be of three months before leaving the organization. Employees belonging to grade A and grade B, who join the service post 35 years of age, may avail the provision post reaching the age of 50. Such services cannot be availed if the employee is suspect of mal practice.
Though minimum years of service rendered exists, yet, post serving for 20 years, any may take VRS post completion of 20 years as well. With former, no approval is required, with latter, approval of an authority is needed.
An employee may avail pension under the scheme if he/she have served for at least 20 years, more the better. They may not be granted full pension, after all there are rules to adhere to.
What is VRS?
As the name suggests, it is the voluntary retirement, employees of certain firms can take. It is usually earlier than the standard practice. It is mainly done, to seek the retirement benefits.
There are several firms who have this policy. This keeps the employees flexible and the company financially good. Most companies give a package to such employees, which is comparatively lesser than what he/she would have got at completion of tenure. This is primarily done to keep rotation of workers in place. Company gets to save money, fresh talent comes in and the employee gets to derive benefits as they want.
Human Resource Accounting
This accounting is a process in which costs are measured in terms of the value an employee puts into an organization. The costs are evaluated since the time of recruitment and ends at the training and development of the employees. After some time it is compared with the profitability a company has gained. This helps in making effective managerial decisions. Proper analysis of human assets is done so that reduction and deductions can be made on time, for future benefits.
Challenges and benefits of VRS
Merits of the scheme are listed below:-
- There is no fulfillment of legality involved, it is good for the company and is supported by unions
- The packages offered are very attractive for employees and in the interest of the company
- This can be easily applied on departments where there is excess of manpower
- It keeps the morale of the employees high too
There are several limitations of VRS. They are subject to lots of rules and regulations. These laws are implemented on the amount of funds such employees can access. It is a quid-pro-quo process. The employee, while serving needs to invest in the company as well. Else the benefits cannot be derived. Some key demerits are listed below:-
- At times it develops sense of fear amongst employees and they may leave organization during weak phase.
- Trade unions may protest against such schemes and cause trouble in normal day to day working of the organization
- The employees company wishes to keep, they may leave as well
The scheme is not new and the masses are aware of it. Any may avail VRS. This is mostly implemented during the times of recession or when the organization is trying to deduct manpower. No matter what the reason is, every coin has two sides. The scheme has got its own pros and cons.