Steel Authority of India (SAIL) has reduced its workforce by more than 8000 in the last one year. The steel major reduced its workforce from 158,158 in the month of September last year to 149,442 by end-September this year.
According to a SAIL official, the company plans to bring down its manpower to around 100,000 over the next three years. "We need to bring in a synergy between the technology and manpower for surviving the emerging competitive regime in the country as well as in the world," the official said.
Those employees who have completed 10 years of service or above 40 years of age were eligible to apply for the latest VRS, as against the earlier eligibility of 15 years of service or 40 years of age as offered in the VRS in 1999.
More than 20,000 employees have opted for VRS in the last three years while the latest scheme which was in operation from February, 20 to September, 30 attracted about 7500 applications.
"The management has accepted 6,500 VRS applications," the official said.
"We need to reduce our workforce as salary and wage bills of SAIL increased from Rs 1203 crore in 1991-92 to Rs 2735 crore in 1999-2000 registering a compound annual growth of more than 11 per cent," according to the official.
The rationalisation of manpower is expected to get further support after the recent Supreme Court ruling against the automatic absorption of contract labour. In a landmark judgement, the apex court had prospectively quashed the 1976 central government notification prohibiting the use of contract labour for jobs like cleaning, sweeping and dusting of buildings owned and occupied by the central public sector undertakings. The court had reversed its judgement of 1996 with regard to automatic absorption of contract labour.
Despite operation of three successful VRS since 1998-99, SAIL's workforce continued to be far above that in comparable iron and steel facilities internationally. SAIL reported Rs 376 crore losses in the first quarter of the current fiscal against a loss of Rs 231 crore in the same quarter of last year.
