The dark side of the package

Print edition : February 17, 2001

FROM the outside, the VRS package looks an attractive one-time settlement. However, union activists have a different tale, one of woes that befell those who opted for the VRS - either under duress from the management or because of failing health, or just because they were tempted by it.

The fundamental difference between a relatively small salary and the illusion of a hefty VRS package is that the former is a flow and the latter a stock. A salary, however meagre, comes regularly whereas a fixed amount gets depleted by current expenditur es on the necessities of life. Normally, salaries in organised industry are inflation-indexed; even partial indexation provides some cover from the ravages of inflation. A Rs.6-8 lakh package may look attractive - until it is wiped out by a major ailment or disease that such a person is vulnerable to at the age at which he/she opts for the VRS.

To add to these daily uncertainties of life, it is virtually impossible for a worker to identify one area in the financial market where he can park on a long-term basis his life-long savings earned in the form of VRS compensation. The stock markets have played truant, finance companies have often gone bust and mutual funds do not always deliver decent returns month after month while also offering security.

Union activists also point to the psychological scars that torment people in the post-retirement phase. The activity and camaraderie of the workplace is lost for them; the sense of social acceptance, which comes with a job, also diminishes.

Tushar Das, general secretary of the Standard & Chartered (now Standard Chartered Grindlays) All India Employees Union, says that many employees who opted for VRS from the bank in 1999 now live under strained circumstances. The VRS was thrust on the empl oyees by the management. They were told that they could either opt for the VRS or leave with three months' salary. Those who succumbed to the pressure are now suffering. They have no fixed income and have their children to be educated and many of them ha ve daughters to be married off. "Many of them often come to the union office, meet former colleagues and take some load off their chest," said Das.

Pradeep Mukherjee of Chinsurah, formerly a clerk in Standard & Chartered, joined a travel agency after opting for the VRS. Today he is selling soaps and oil door to door. Santanu Ray Chowdhuri, a former clerk in the same bank, found employment in a small private company. However, what he earns now is a pittance compared to what he used to in Standard & Chartered. After being forced to take the VRS, two men from Mumbai, who were class IV staff in the bank, took to crime for survival.

The list of such VRS-affected people is long. According to Tushar Das, out of the 300 employees who accepted the VRS, only nine or 10 have managed to remain on an even keel.

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