IDBI plans to offer VRS, to rejig pay

IDBI Ltd will offer its employees a voluntary retirement scheme (VRS) in line with other public sector banks. The new deemed banking company is set to revamp its compensation structure with performance-based pay, chairman M Damodaran said.

The IDBI Ltd board approved the VRS at its meeting on September 30. The VRS will be open for a month beginning November 1. IDBI Ltd has 2,801 employees.

"We do not have a target for the VRS. This is an enabling provision for our employees and not a downsizing exercise. This is merely an option being given to our employees in line with the recommendation made in the IDBI Bill. Some of our employees have also expressed interest to leave," Damodaran said.

The new banking company will also introduce performance-related compensation. "We will appoint HR consultants to revamp our compensation structure. We will introduce such as things as balance score cards to assess performance of all our employees," he said. The bank is to have incentives for both group and individuals.

Till date IDBI followed the compensation package of the Reserve Bank of India. If IDBI Ltd carries out the -erformance based structure it will be the first public sector bank to break away from the industry wide wage settlement process.

There is a four-member integration team currently at work to deal with merger-related issues. It comprises two employees each from IDBI and IDBI Bank.

The merger is to take place by fiscal end. A consultant has also been appointed for to arrive at a swap ratio for the merger.