News: BSNL cuts employee benefits to curb cost

Benefits & Rewards Consulting

BSNL cuts employee benefits to curb cost

BSNL had saved Rs 2,500 crore through a similar cost cutting exercise and the telecom giant is planning to repeat the same this year. Out of the money saved by the company last year, Rs 625 crore was employee benefits.
BSNL cuts employee benefits to curb cost

In order to cut down its expenses government owned telecom company, Bharat Sanchar Nigam Limited (BSNL) has frozen employee benefits. It can be recalled that last year BSNL had saved Rs 2,500 crore through a similar cost cutting exercise and the telecom giant is planning to repeat the same this year. Out of the money saved by the company last year, Rs 625 crore was employee benefits.

The current employee strength of BSNL is 3.57 lakh which is multiple times higher than its competitors who have around 25,000 to 30,000 employees.

Anupam Shrivastava, BSNL Chairman and Managing Director, said "We are cutting costs in terms of electricity, administrative expenses and freezing our employee benefits. For the time being, we are not giving any LTC (leave travel concession) benefits, etc. The medical expenses are also being controlled."

To manage its financials and bounce back the organization has submitted a preliminary report by IIM- Ahmadabad. The report has suggested granting voluntary retirement scheme (VRS) as one of the measures. The move would affect around 35,000 employees at the cost of Rs 13,000 crore.

The company is working on different models to meet the costs for its VRS package. The company is expecting monetary support via government aid or a soft loan. 

According to the media report, the government owned telecom company has been posting losses post the entry of Reliance Jio in 2016. The sector has also witnessed consolidation and only three private players have been left in the Indian market. The company is looking to find new ways of staying afloat by saving costs and finding new sources of revenue.

Pic Source- Live Mint

Read full story

Topics: Benefits & Rewards Consulting, #Corporate

Did you find this story helpful?

Author


QUICK POLL

Post-COVID, which aspect of work will technology impact the most?

2 months free subscription
q_auto,f_auto/v1599122279/mag-september-2020.png

Subscribe to all new People Matters HR Magazine

.

Subscribe
And Save 59% plus Two months free

Subscribe now

Are we too remote for our employees?

Participate and get your free pulse report.

Participate Now