Manufacturing company Cummins India Limited, has announced an voluntary retirement program or VRS for its professional/exempt employees who have completed minimum 10 years of service and are above 45 years of age.
Cummins India, in a communication to exchanges said, this has been done with the "objective of reducing headcount to manage the cost structure based on the business cycles."
The company did not disclose the financial impact of the VRS scheme. "An update on the financial impact will be communicated upon conclusion of the program," the company said.
Net sales of Cummins India for the quarter ended September 30, 2019, had declined 11 percent year-on-year to ₹1,285 crore.
Commenting on its Q2 earnings, which were announced on October 24, Ashwath Ram, MD of Cummins India Limited, had said: "The current sluggishness in the Indian economy arises from several factors including the prevailing liquidity situation, delays in awarding of infrastructure projects, banking sector including the shadow banks continuing to sort through their funding constraints. These factors have all resulted in reduction in demand across our key segments in the domestic business."
Earlier other companies on the lines of Cummins have also offered VRS to its employees in masses. 92,685 employees of BSNL and MTNL opted for the VRS. Tata Motors Ltd was also in news for working on offering VRS to its 1,600 employees owing to prolonged crisis in automotive industry.
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