SBI associates offer VRS to employees

Soon after the Cabinet approved the long-awaited merger of SBI with its five associate banks, these associate banks have come up with voluntary retirement scheme (VRS) offer for its employees, to be availed before the merger comes into effect. Out of the five, board of directors of State Bank of Hyderbad have given a green signal to the VRS scheme, while approval by other associates is awaited.

According to the VRS offer document, the offer would be open to all who have been in service for 20 years or more or attained the age of 55 years as on November 30, 2016. The employee strength of all associate banks eligible for VRS would be around 50000.

On acceptance of voluntary retirement, the retiring employees will be eligible for additional pay as ex-gratia, which would be 50 per cent of the salary for the outstanding period of service or 30 months’ salary, whichever is lower. The ex-gratia will be paid in cash, along with other benefits (gratuity, PF etc) and will be paid within 5 weeks of retirement.

The said move is expected to offset the liabilities from associate banks as the expenditure on employees of SBI would definitely reduce. The expenses on employees in December stood at Rs 7137 crore, registering 16.5 per cent YoY growth.