Tata Steel Introduces Early Separation Scheme To Cut Cost

Tata Steel Introduces Early Separation Scheme To Cut CostTata Steel, India’s leading steel maker has introduced an early separation scheme for its employees in its Jamshedpur plant in Jharkhand to downsize its ‘less skilled’ workforce. Tata Steel spokesperson said, "ESS scheme is a voluntary scheme and has got nothing to do with the global economic recession. We cannot ascertain the number of people who will be opting for this option. In view of investment in better and modern technology to increase productivity level, more skilled and fewer people are required."
Employees over 50 years of age would be eligible for the scheme. Under it, they would get a consolidated amount as per their salary structures and will also be entitled to avail pension benefits.
In the last one decade, Tata Steel has trimmed its workforce to 34,000 from the previous 74,000. Under the ESS, the company is planning to relieve around 2,100 employees. Tata Steel Managing Director, B Muthuraman, while announcing Tata Steel's consolidated results for the quarter and half-year ended September 30, stated, “The company intends to save Rs 300 crore in the next five months by reducing operational expenditures and overhead costs.”
Tata Steel has shown a two-fold growth in consolidated net profit at Rs 4,703.64 crore for the second quarter of the fiscal.