IPCL to offer VRS

Even before the proposed amalgamation of Indian Petrochemicals Corporation Limited (IPCL) with Reliance Industries Limited (RIL) is approved by the board, IPCL is targeting a 44 per cent reduction of its staff through Voluntary Retirement Scheme involving a payout of anywhere between Rs 400-600 crore.

About 4,000 of the 9,000 employees of IPCL are expected to opt for the scheme by the end of this month. The process is already underway. IPCL is reportedly offering a VRS compensatory package of Rs 10 lakh to Rs 15 lakh to its employees. The re-structuring of the IPCL manpower is expected to smoothen the integration process with RIL, sources close to IPCL said.

IPCL has been typically over-staffed in keeping with the tradition of public sector units. IPCL was acquired by RIL in 2002. However, since at that time IPCL's performance was poor, the compensation that would have been provided would not have been upto the mark.

At present, with import duties on polymers rising to five per cent and other costs rising fast, giving the option of VRS to non-supervisory and non-operational staff of IPCL seems to be the only way of increasing productivity and profitability at the company's plant in Vadodara.