Mahanagar Telephone Nigam (MTNL) has announced a significant workforce reduction plan through a Voluntary Retirement Scheme (VRS). The move is aimed at cutting employee costs and streamlining operations.
The scheme, approved by MTNL’s board, targets employees aged 45 and above, including both executives and non-executives. It is based on the Gujarat Model but includes modifications, such as a reduced ceiling on ex-gratia payments. Ex-gratia refers to a one-time financial compensation offered to employees who opt for voluntary retirement.
The decision is part of MTNL’s broader strategy to make the organisation leaner and reduce its wage bill. The company has been struggling with a massive debt burden of over Rs 31,000 crore.
At 9:50 am, MTNL shares were trading at Rs 52.59, a 2.45 per cent rise from the previous day’s close. However, the announcement of job cuts comes amid ongoing financial challenges. Sources suggest the company may avoid heading to the National Company Law Tribunal (NCLT) for resolution, with a potential revival plan in the works.
The introduction of VRS highlights MTNL’s efforts to address financial pressures by reducing its workforce, even as it faces an uncertain path toward recovery.
